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Introduction . . . . . . . vii 


I. The Nation's Future .... 3 

II. Agriculture and the National Life . 45 

III. Farm Methods Old and New . . 65 

IV. Reciprocity with Canada ... 85 
V. Commerce ...... 101 

VI. Industrial and Railroad Consolidations 114 

VII. The Northwest 140 

VIII. Oriental Trade. Part I Constructive 156 

IX. Oriental Trade. Part II Destructive 170 

X. Irrigation and Drainage . . . 185 

XL Waterways 208 

XII. The Railroad. Part I Construction 

and Operation 234 

XIII. The Railroad. Part II Financing, 

Rates and Profits .... 250 



XIV. The Railroad. Part III Legislative 

Regulation and Its Limits . . 269 

XV. The Conservation of Capital . . 286 

XVI. The Natural Wealth of the Land and 

Its Conservation .... 309 

Index 329 


NATIONS, like men, are travellers. Each one 
of them moves, through history, toward what 
we call progress and a new life or toward 
decay and death. As it is the first concern of every 
man to know that he is achieving something, advancing 
in material wealth, industrial power, intellectual strength 
and moral purpose, so it is vital to a nation to know 
that its years are milestones along the way of progress. 

About this conviction centre much of our public 
thought, most of our public discussion, nearly all of 
our public action. The methods suggested or adopted 
may be mistaken; may, and indeed often do, lead in 
the wrong direction. But the aspiration is true and 
it is constant. It searches always among policies, 
devices, inventions and systems for the few broad 
ways that lead to a real advance all along the line. 
This is the ancient method of natural selection, by which 
men and nations have improved upon their own past. 

Down to within a century this study of ways and 
means dealt almost wholly with abstractions. It 
sought to establish certain general principles and uni- 
versal laws which, once put into words, would be as 
final for social activity as the rules of arithmetic are 
for the solving of its problems. These made up the 


science of the old political economy. But the appli- 
cation of a system of unchanging laws to those variable 
quantities, man and society, proved unworkable; and 
orthodox political economy fell into a deeper disrepute 
than it deserved. 

This has been followed by a period of almost pure 
empiricism in our economic thought and conduct. 
Each incident, each danger and each need has been 
isolated, enlarged and studied alone, with little regard 
to the organic relation between the different interests 
in the life of man, and the general laws that unify them. 
The result is conflict, confusion, failure and waste 
of material and mental forces. Many thoughtful 
people, including some of those who should be 
instructors and leaders of the public, have fallen 
victims to the purely imaginative theories of socialism; 
theories which, if they could be literally applied, would 
destroy the vitality of society as an organic thing and 
establish a tyranny so universal and so minute as to 
make both the industrial and the social life of man 
intolerable. There is great need of a broader under- 
standing of the relation of one interest to another in 
the social life of man; of their interdependence as well 
as their separate values; of the community as an 
economic whole. 

The physical sciences have added to knowledge 
by applying the particular fact to the general law as 
explanation or corrective, and the general law to the 
particular fact for purposes of classification and new 
generalization. By this same combination of the ab- 


stract and the concrete, the general and the particular, 
they have thrown new light on the material world and 
its laws within a century. It seems to be time to apply 
their method to economic facts and changes. 

The present volume is, within the limits set by its 
range of subjects, an effort in that direction. In it I have 
discussed those matters with which study and experi- 
ence have made me best acquainted, and endeavoured 
both to fit laws to facts and to combine facts so that 
their laws may be made plain. Just such a combina- 
tion of the inductive and the deductive methods every 
successful man makes every day of his life. It is, 
indeed, the main secret of his success. It should, 
therefore, make clear what are some of the things that 
we must seek and what some of those that we must 
avoid. This volume does not attempt to cover the 
immense field; but simply, as a collection of studies in 
applied economics, to erect here and there, along the road 
the nation travels, certain sign-boards where the ways 
diverge and mark them, " Highways of Progress." The 
effort may not be successful, but it is at least sincere. 

The first chapter indicates the scope and outline of 
the work. It consists of an address delivered in 1906 
before the Agricultural Society of Minnesota. This 
was published nearly a score of times by individuals, 
institutions and societies in this and other countries, 
and has been translated into several languages. It 
was the first to announce the doctrine of Conservation 
as a whole, and not an incident of some one occupa- 
tion; and it sought through this to fix the nation's 


attention upon the necessary re-adjustment of industry 
with reference to our greatest asset, the soil. The 
eager interest with which the discussion thus opened 
up was received and taken up by the public, and by 
the President of the United States, was proof of the 
need for it and its timeliness. Because of its part in the 
development of a more practical industrial ideal, and 
because the other chapters follow out in detail the lines 
of its argument, this has been republished unchanged. 

The last chapter, also, is published substantially 
as delivered before the Conference of Governors that 
met at the White House, Washington, in the latter 
part of 1907. Looking backward over the field of con- 
servation, as the opening chapter looks forward, it is 
given as a fitting conclusion to the volume. 

The intermediate chapters, some of which appeared 
in recent numbers of The World's Work, deal with 
conclusions of fact reached by the method just stated. 
Many of their ideas and expressions may be found 
in addresses made or articles published by me during 
the last ten years. But they are here arranged for 
the first time around their logical central thoughts; 
here first connected with all the lines of statistical fact 
that substantiate them; here first set in that relation 
of parts to a whole which gives to the book its title, 
Highways of Progress. If it shall help to make that 
way plain, the labour that has gone to its preparation 
will be well repaid. 


May i, 1910. 




THE highest conception of a nation is that of 
a trustee for posterity. The savage is con- 
tent with wresting from nature the simple 
necessaries of life. But the modern idea of duty is 
conservation of the old and modelling of the new in 
order that posterity may have a fairer dwelling place 
and thus transmit the onward impulse. The ideal 
of the prudent, loving, careful head of every family 
is the true ideal for a nation of rational men. The 
people of the United States, as far as any perhaps, 
have meant to follow this pattern. It is worth while 
to consider how far they have been successful and where 
they have failed. 

The average man is often more interested in specu- 
lative theories than in his plain duty toward himself 
and his neighbour. The average state is filled with 
visions of its place in the procession of the years, while 
it overlooks the running account of daily expenses. 
Problems we have found and trifled with, in confusing 
number and variety; but the problem of the future 
material condition of our country, of an inventory of 


its assets and liabilities, of the inevitable demands upon 
its resources and the careful adjustments by which 
alone they may be preserved, has thus far been a 
subject for little more than a passing thought. 
National security calls for a just accounting of the 
business affairs of this great nation. 

Let us try to cast our minds twenty or twenty-five 
years ahead and see what will then be our condition. 
The main elements of this problem, which above all 
others should command our attention, are three: 
Possibilities of population, actual and possible natural 
resources, and possibilities of productive application 
of one to the other. As the prudent man, about settling 
himself in life, sums up his possessions, his oppor- 
tunities for earning income and the demands upon 
him of a family to be fairly cared for and left in a posi- 
tion to begin the world at least as advantageously as 
he did himself, so the people of the United States should 
know with reasonable exactness just where we must 
stand half a century from now. 

The population index has the simplicity of ascer- 
tained vital statistics. Subtracting from the total 
population of the country as returned by each census 
since 1880 the immigration for the decennial period, 
the ratio of increase for the first decade is slightly over, 
and for the second decade slightly under fifteen per 
cent. So careful an observer as Leroy Beaulieu gives 
the natural increase of our population as fifteen and 
two-tenths per thousand per year. It is fair, therefore, 
to reckon the increase by the excess of births over 


deaths at fifteen per cent, on the average, for each 
decade. The additions by immigration are more 
variable. It is highly probable, however, that the 
incoming tide will increase. Only in periods of severe 
depression has immigration fallen much below the 
half-million mark for the last twenty-five years. In 
good or fairly good times it has gone greatly above. 
In the two years before 1905 it exceeded 800,000 annu- 
ally, while for 1905 and for 1906 it exceeded 1,000,000. 
It is a conservative estimate, therefore, to add 750,000 
a year for increase of population from this source, or 
7,500,000 for each decade. Computed on this basis, 
the population of the United States in the near future 
will show these totals: 

Population in 1910 95,248,895 

Population in 1920 117,036,229 

Population in 1930 142,091,663 

Population in 1940 . 170,905,412 

Population in 1950 204,041,223 

These figures announce the magnitude of our prob- 
lem. It is not even a problem of to-morrow, but of 
to-day. Within forty-four years we shall have to 
meet the wants of more than two hundred million 
people. In less than twenty years from this moment 
the United States will have 130,000,000 people. Where 
are these people, not of some dim, distant age, but 
of the generation now growing to manhood, to be 
employed and how supported ? When the search- 


light is thus suddenly turned on, we recognize not a 
mere speculation, but the grim face of that spectre 
which confronts the unemployed, tramping hateful 
streets in hope of food and shelter. 

We cannot adapt our conditions to our future by 
restricting the growth of population. The natural 
increase by birth will continue. We may not, did we 
wish it, interfere with the immigration movement, 
except perhaps to enforce a more careful scrutiny of 
the moral and industrial fitness of these newcomers. 
Notwithstanding the addition of more than a million 
people a year from abroad, nearly all of them men 
and women who must work for a living, labour out- 
side of the cities was never as scarce or wages as high 
as at the present time. Immigration lingers in the 
great centres and adds to the difficulties attending 

The farms stretch out their hands in vain. Rail- 
roads have to get labourers for building extensions at 
the highest market price, and find a large percentage 
of those whom they employ mere hoboes who desert 
as soon as they have succeeded in getting transportation 
from one part of the country to another. Farmers 
besiege the employment agencies in vain, and offer 
the lazy tramp a sum for a day's work in the field 
unheard of in any other country in the world. The 
situation grows more embarrassing yearly. Hours 
of labour are being reduced in some of the states for 
farm as well as shop hands. Men are scarcer as the 
movement of population to the cities grows more pro- 


nounced. A considerable portion of any crop more 
than usually abundant is either reduced in quality or 
altogether lost by reason of the impossibility of getting 
labour to handle it properly. Discouraged small 
farmers sell their land to larger proprietors who can 
profitably substitute machinery for men. 

The country needs more workers on the soil. Not 
to turn the stranger away, but to direct him to the 
farm instead of the city; not to watch with fear a 
possible increase of the birth rate, but to use every 
means to keep the boys on the farm and to send youth 
from the city to swell the depleted ranks of agricultural 
industry this is the necessary task of a well-advised 
political economy and an intelligent patriotism. 

The United States has been able easily to take care 
of its great increase of population in the past because 
it had a vast area of unoccupied land. This was the 
main asset in its natural inheritance. Within prac- 
tically the last half of the last century the whole country 
from the Mississippi River to the Rocky Mountains 
was occupied. No pressure of population could make 
itself severely felt when it might be turned loose in such 
an empire. In those fifty years there were added 
547,640,932 acres to the agricultural area, an increase 
of nearly two hundred per cent., and the increase in 
the actually improved acreage was nearly three hundred 
per cent. This is cut off from the list of our resources. 
Within the last six years there have been transferred 
from public to private ownership more than 100,000,000 
acres of Government land, an area twice the size of 


the State of Minnesota. The entire area of surveyed 
and unappropriated land within the United States 
is only two and a half times that amount. 

At the present rate, therefore, every acre of public 
land would disappear within the next fifteen years. 
But as a large percentage of the lands included in this 
estimate are wholly or partially unfit for tillage, it is 
literally true to say that our arable public lands have 
almost disappeared. And where are our children 
to find standing room, and the tens of millions of the 
future a place for wholesome industry ? This is an 
intensely practical question. It is immediate. For 
within twenty years we must house and employ in 
some fashion fifty millions of additional population; 
and by the middle of this century, at a time when the 
child now born will be in the prime of life, there will 
be approximately two and a half times as many people 
in the United States as there are to-day. 

No nation in history was ever confronted with a 
sterner question than this certain prospect sets before 
us. What are we to do with our brother, whose keeper 
we are ? How are we to provide our own children 
with shelter and their daily bread ? 

Rational consideration of our potential resources 
and of available future employment for this great 
multitude must, of course, proceed together. Labour 
must have material to work upon; and labour and 
material must also be so conjoined that the sum total 
shall be an increase of product equal to the advancing 
demands upon it, while at the same time our natural 


resources shall not be exhausted. Only thus can the 
future be made safe. Only thus can the people of 
the years to come be saved from retrogression. We 
come back to the big, fundamental things; to raw 
materials, and supply and demand, and the severe 
utilities without which no nation, great or small, can 
long keep poverty and distress or even death at bay. 

"Of all the sinful wasters of man's inheritance in 
the earth and all are in this regard sinners the 
very worst are the people of America." These are 
the words of a great scientific authority, the late Pro- 
fessor Shaler, of Harvard University. This nation 
of presumably busy and serious men has originated 
many wasteful and extravagant policies; nay, worse, 
it prides itself upon some of the very records of con- 
sumption which establish the astonishing fact of 
national destruction and waste that cannot be repaired. 
The mighty wealth of this continent was adequate, 
with ordinarily provident handling, for an indefinite 
increase of the demands upon it. The inheritors of 
this wealth have already so far dissipated it that some 
prudent care of the residue cannot be postponed with- 
out certain disaster. 

The summation of actual resources of national 
wealth is a comparatively short and simple process. 
Passing over the atmospheric elements that minister 
indirectly to the national economy, there are just four 
sources from which mankind must draw all natural 
wealth. Of these the sea does not supply more than 
two or three per cent, of man's food. It may therefore 


be dropped from the calculation, as it cannot be made 
much more largely contributory to human support. 
The forest, once a rich heritage, is rapidly disappearing. 
Its product is valuable not for food, but for shelter 
and as an accessory in the production of wealth. Its 
fate is interesting here rather in the role of an example. 
For we have done already with our forests what we 
are doing just as successfully with the remainder of 
our natural capital. Except for the areas on the Pacific 
Coast, the forest as a source of wealth is rapidly dis- 
appearing. Within twenty years, perhaps, we shall 
have nowhere east of the Rocky Mountains a timber 
product worth recording; and must then begin in 
earnest the slow process of reforesting. 

What is less clearly perceived is that we are wasting 
in the same fashion other resources which no repent- 
ance and no ingenuity can restore or replenish. The 
exhaustion of the greatest of these, the land, will be 
spoken of later. Our mineral wealth, however, stands 
on another plane. What is taken from the mine can 
never be replaced. Through all eternity, so far as 
we can see, the consumption of mineral wealth stored 
in the ground must be a finality. The possible gross 
product is mathematically limited. The adaptation of 
this to future uses should be a matter of infinitely 
greater anxiety than the present balance sheet of a 
business concern. Yet the singular fact is that, among 
a people supposedly grounded in the rudiments of 
political economy, the progressive exhaustion of this 
precious resource is everywhere heralded as a triumph 


of enterprise and a gauge of national prosperity. The 
nation publishes periodically the record of its scattering 
of assets never to be regained; and waits, with a smile 
of complacence, for general congratulation. 

The two great resources of the under earth, econom- 
ically speaking, that are indispensable to human 
comfort and growth, are coal and iron. Our inheri- 
tance of these was princely. The most wonderful 
achievement of this age is the incredible activity with 
which we are exhausting them. The coal areas and 
measures of the United States are describable only in 
somewhat general terms. But the fact of the future 
is not doubtful. No dependable authority gives more 
than a century of life to our main available coal supply. 
It will not all be gone by that time, but the remainder 
will have to be obtained from deposits of low grade 
or at great depths, or from points remote from where 
it is most needed. It will be poor in quality, or high 
in price, or both, so that its economic employment on 
existing terms will be very difficult. A generous esti- 
mate of competent geologists for the life of the better 
coal measures of Europe as a whole is less than one 
hundred years. The output of the United States is 
now more than 350,000,000 tons annually. It doubled 
within the decade from 1895. It amounts to between 
forty and fifty per cent, of the world's entire supply. 
The estimated life of the Pennsylvania anthracite fields, 
whose narrow area has permitted closer approximation, 
is put at little more than fifty years. The larger supply of 
soft coal has to answer a demand many times as great. 


It is certainly a moderate statement to say that, 
by the middle of the present century, when our popu- 
lation will have reached the two hundred million mark, 
our best and most convenient coal will have been so 
far consumed that the remainder can only be applied 
to present uses at an enhanced cost which would 
probably compel the entire rearrangement of industries 
and revolutionize the common lot and common life. 
This is not a mere possibility, but a probability which 
our country must face. 

The prospect of the iron interest is even more threat- 
ening and more sure. Our available iron deposits 
have been carefully catalogued. All the fields of 
national importance have been known for at least 
twenty years. Within that time their boundaries and 
probable capacity have been estimated, and the whole 
country has been prospected. The most reasonable 
computation of scientific authority affirms that existing 
production cannot be maintained for fifty years, assum- 
ing that all the available iron ore known to us is mined. 
In fact, the period of free supply is likely to be 
much shorter. 

In 1870 the United States produced a little more 
than 3,000,000 tons of iron ore. It increased by about 
one hundred and fifty per cent, for each decade to 1890. 
As late as 1895 it was a trifle short of 16,000,000 tons. 
In 1902 and 1903 it was, in round numbers, 35,000,000 
tons, and in 1905 it rose to about 42,000,000 tons. 
At this rate, as all the trade statistics indicate, and as 
our present policy and growth in population require, 


it will soon reach 50,000,000 tons. By every possible 
means we are stimulating consumption; especially 
by a tariff that places a bounty on the exhaustion of the 
home supply of both coal and iron, thus prohibiting 
recourse to outside supplies and compelling the exhaus- 
tion of our own reserve. 

The main iron deposits in this country are those 
of the Lake Superior region. These furnish nearly 
or quite three-quarters of the entire product of the 
United States. Deprived of these, our output would 
shrink to a beggarly ten million tons or so a year. 
And these deposits are not veins of unknown depth 
and richness, but pockets of ascertainable volume. 
There is within reach possibly 1,500,000,000 tons 
of merchantable iron ore in the deposits of Min- 
nesota, Wisconsin and Michigan. This will keep our 
industry going, supposing consumption to remain 
stationary, for thirty or forty years. In the year 1950, 
so far as our own resources are concerned, will approach 
an ironless age. For a population of 200,000,000 
people, our home supply of iron will have retreated 
almost to the company of the precious metals. 

There is no substitute whose production and pre- 
paration for practical use is not far more expensive. 
Not merely our manufacturing industries, but our 
whole complex industrial life, so intimately built upon 
cheap iron and coal, will feel the strain and must 
suffer realignment. The peril is not one of remote 
geologic time, but of this generation, And where is 
{here a sign of preparation for it ? Where, amidst our 


statistical arrays and the flourish of trumpets with 
which the rise of our manufactured product is always 
announced, do we hear so much as a whisper of care 
about the needs of the time marching so swiftly upon 
us ? Instead of apprehension and diligent forethought 
for the future, the nation is engaged in policies of 
detail and opportunism. 

If any man think this prophecy of danger fantastic, 
let him glance at Great Britain. That nation was 
not so extravagant as we, because it did not compel 
the instant exhaustion of its resources by a tariff 
prohibiting such imports, and because its surplus 
population could and did scatter over the globe. But 
it has concentrated effort upon the secondary form 
of industry manufacturing; at the sacrifice of the 
primary the tillage of the soil. Its iron supply is 
now nearly exhausted. It must import much of the 
crude material or close its furnaces and mills. Its 
coal is being drawn from the deeper levels. The 
added cost pinches the market and makes trade smaller 
both in volume and in profits. 

The process of constriction has only begun. None 
are advertising it, only few understand it. But already 
there is the cry of want and suffering from every street 
in England. From a million to a million and a half 
of men are huddling together in her cities, uttering that 
most pathetic and most awful ultimatum, "Damn 
your charity, give us work." And this is only the 
beginning of that industrial readjustment which the 
unwise application of industry and the destruction 


of natural resources must force everywhere. He who 
doubts may easily convince himself by an honest 
investigation of the facts, that this is no sensational 
prediction, but something as established and inevit- 
able as an eclipse or the return of the seasons. The 
most amazing feature of our situation, indeed, is its 
vast and compelling simplicity. 

Every people is thus reduced, in the final appraisal 
of its estate, to reliance upon the soil. This is the sole 
asset that does not perish, because it contains within 
itself, if not abused, the possibility of infinite renewal. 
All the life that exists upon this planet, all the develop- 
ment of man from his lowest to his highest qualities, 
rest as firmly and as unreservedly upon the capacities 
of the soil as do his feet upon the ground beneath him. 
The soil alone is capable of self-renewal, through the 
wasting of the rocks, through the agency of plant life, 
through its chemical reactions with the liquids and 
gases within and about it. A self-perpetuating race 
must rely upon some self-perpetuating means of support. 
Our one resource, therefore, loqking at humanity 
as something more than the creature of a day, is the 
productivity of the soil. And since that, too, may 
be raised to a high power or lowered to the point of 
disappearing value, it is of first consequence to con- 
sider how the people of the United States have dealt 
with this, their greatest safeguard and their choicest 

This is pre-eminently and primarily an agricultural 
country. Its soil has been treated as have been its 


forest and mineral resources. Only because the earth 
is more long-suffering, only because its exhaustion is 
difficult and occupies a long period, have we escaped 
the peril that looms so large in other quarters. The 
reckless distribution of the land; its division among 
all the greedy who chose to ask for it; the appro- 
priation of large areas for grazing purposes, have 
absorbed much of the national heritage. Only one- 
half of the land in private ownership is now tilled. 
That tillage does not produce one-half of what the 
land might be made to yield, without losing an atom 
of its fertility. Yet the waste of our treasure has 
proceeded so far that the actual value of the soil for 
productive purposes has already deteriorated more than 
it should have done in five centuries of use. There is, 
except in isolated and individual cases, little approach- 
ing intensive agriculture in the United States. There 
is only the annual skimming of the rich cream; the 
exhaustion of virgin fertility; the extraction from the 
earth, by the most rapid process, of its productive 
powers; the deterioration of life's sole maintenance. 
And all this with that army of another hundred million 
people marching in plain sight toward us, and expect- 
ing and demanding that they shall be fed. 

From 1860 to 1900 is a far cry. In that time our 
population leaped from 31,000,000 to 76,000,000. In 
that time a vast area of wilderness was put beneath 
the plough. Yet in those same years the area of 
improved land in the North Atlantic States remained 
stationary. It is now steadily on the decrease. In 


the South Atlantic States, while the inclosed area is 
larger, the farming area has decreased by more than 
2,000,000 acres. 

The test of values is still more indicative. Every 
farm properly cared for should be worth more money 
for each year of its life. The increase of population 
and demand, the growth of cities and markets, and 
the development of diversified farming with density 
of settlement should insure a large increment. Even 
where large quantities of new and fertile land are 
opened, these influences, together with the lowest 
cost of transportation in the world, should make the 
growth of values steady. Within the twenty years 
between 1880 and 1900 the aggregate value of farm 
lands and improvements, including buildings, declined 
in every one of the New England and Middle States 
except Massachusetts. The total decrease in values, 
for these ten states, of the first asset of a civilized people 
is more than $300,000,000. Nor is the attempted 
explanation by the census bureau of this shrinkage 
either adequate or convincing. Even the great and 
fertile State of Ohio, in the Middle West, showed a 
decline of more than $60,000,000. This change in 
the section of oldest cultivation under modern con- 
ditions is significant. It is not singular. The soil 
of the South is moving on the same decline, though 
the fact is less obvious in the total change of agricultural 
conditions since the Civil War. On the new lands 
of the West, where once the wheat yield was from 
twenty to thirty bushels per acre, it is now from twelve 


to eighteen. Frankly, and without shame, this is 
attributed to "the wearing out" of the soil, as if the 
earth were a garment that must be destroyed by the 

If the earth, the mother of humanity, is to "wear 
out," what is to become of the race ? The fact is that 
soils, properly treated, maintain their productiveness 
indefinitely under cultivation. The further fact is 
that, with the disappearance of pestilence and the 
discontinuance of war that belong to the future, all 
contributing to the growth of population, the pro- 
ductive capacity of the soil must be sustained at its 
highest point or the world suffer want. 

The life-sustaining power of the soil is lowered in 
two ways: First, by physical destruction, through the 
carrying away of the earth to the sea; and, second, 
chemically, by the withdrawal of the elements required 
for plant life. The waste from the former cause is 
very great. It accounts for sterility in the older, 
which are also the more hilly, portions of the cultivated 
country. It may be easily checked or prevented. 
The agriculture of Japan, which is of the highest type, 
preserves a mountain farm intact by terracing and 
careful modulation of its level. Professor Shaler says 
that a field lying at an angle of twenty degrees can be 
totally destroyed in a hundred plowings. Throughout 
the South this process of denudation has proceeded 
far and is going forward rapidly. He estimates from 
personal observation that in the State of Kentucky, 
where cultivation is hardly more than a century old, 


one-tenth of the arable soil has been destroyed, and 
that a considerable portion of this cannot be restored 
by any application of industry and care. 

More serious and even more universal and speedy 
is the process of deliberate soil exhaustion. New 
England once supported a population of farmers whose 
shot was heard around the world. Professor Carver, 
of Harvard, after a tour of five hundred and fifty miles 
on horseback in 1905, records his conclusion that 
"agriculture as an independent industry, able in itself 
to maintain a community, does not exist in the hilly 
parts of New England." It is not many years since 
the favoured wheat-producing areas of the American 
Northwest gave a yield of from twenty-five bushels 
per acre upwards. Now an average of twelve to fifteen 
is accepted as satisfactory. Under the stress of need, 
by intelligent cultivation, many of the lands of Great 
Britain, cropped for a thousand years, are made to 
bear thirty bushels to the acre. The rich, deep soil 
of our own country, drawn upon for a few decades, 
produces about twelve. The same ratio holds good 
of other cereals and of every product of the field. The 
sea islands that once grew the most famous cotton 
staple in the world are virtually abandoned. 

The people have neglected the preservation of the 
soil. They take away all and give nothing back. 
Thorough fertilization of the land has no place in the 
general work on the American farm. Average Ameri- 
can agriculture means the extraction from nature of 
the greatest immediate return at the lowest possible 


outlay of labour or money, with sublime disregard 
of consequences. Except at scattered experiment 
stations and in isolated instances there is little done 
in the United States toward farm economies. Scienti- 
fic adaption of soil to product, intelligent rotation of 
crops, diversification of industry, intensive farming - 
constitute the rare exception and not the rule. 

Only two states in the Union show an average total 
value of farm products in excess of $30 per acre of 
improved land. The figure for Illinois in 1900 was 
$12.48; for North Carolina, $10.72; for Minnesota, 
$8.74. By proper cultivation these returns could 
easily be doubled and still leave the soil's resources 
unimpaired. The doubling of all products of the 
farm would add to the wealth of this country from 
$6,000,000,000 to $8,000,000,000 every year, according 
to the crop yield of the season and the range of market 

Therefore, and this is the focal point of the whole 
matter, the country is approaching the inevitable 
advent of a population of 150,000,000 or 200,000,000, 
within the lifetime of those now grown to man's estate, 
with a potential food supply that falls as the draft upon 
it advances. How are these people to be fed ? 

The foreign trade of the United States has been 
made an object of more or less solicitude and self- 
gratulation. What we do is to export in immense 
volumes two great classes of commodities. One con- 
tains raw materials, the products of the upper and the 
under earth. It includes, adding articles like flour, 


provisions and refined oil, which are but one degree 
removed from the raw state, changed in form for econ- 
omy of transportation, three-fourths of our entire 
exports of domestic commodities. The treasury of 
our future is being despoiled to swell the rapidly grow- 
ing riches of the day. The remaining thirty per cent, 
or less, which is all that can properly be classed as 
products of manufacture, is this stored treasure in 
another form. Exports of domestic manufactures, 
construing the term with proper strictness, constitute 
a trifle more than twenty per cent, of the total. 

This pitiful showing in the markets of the world 
where our people might find occupation, where a larger 
proportion of them must find it in the future if all are 
to survive or remain, a showing that not even the 
endeavours of boasters can improve, is the inevitable 
consequence of a policy more destructive than that 
of the spendthrift. Lest the conditions of life should be 
made too favourable for this people, its home markets 
are surrendered, bound rigidly by law, to the com- 
paratively small number who control domestic supplies 
of raw material for manufacture. At the same time 
the cost of production effectually prevents the securing 
of any considerable or permanent control in the markets 
of the outer world, where alone our millions of to- 
morrow could find outlet for this form of their activity. 

The single intelligent advance on practical lines 
made by public authority within the last quarter of 
a century is the reclamation law. Initiated and paid 
for by a few western railway companies, it provides 


for a real addition to the sources of food supply and 
the opportunity for employment. But it is only a 
light breeze blowing in the face of a cyclone. If every 
project contemplated as feasible were executed, and 
if all were completed instantly by the rub of a magic 
lamp, some 60,000,000 acres would be added to the 
arable national domain. And if only forty acres of 
this were assigned to each family, it would supply the 
needs of the actual addition to population, by natural 
increase and by immigration, for less than three years. 
Professor Shaler, in a survey of world conditions 
from the broadest scientific point of view, looking at 
man and his storehouse in the large, at supply and 
exhaustion, says, in "Man and the Earth": 'This 
attitude of men as regards the future of the material 
value of the earth notably contrasts with what they 
hold to the moral and political future of their kind. 
A large part of their thought and endeavour goes to 
that group of problems, but practically none at all 
to the immediate questions that relate to the material 
foundations on which all the higher development of 
the life of their kind has to rest." Man may win, 
beyond peradventure man will win, from the silent 
willingness of nature, from her sternness and her clem- 
ency, from her outpouring and her withholding, the 
utmost of his aspiration. But the highway to the 
perfect condition must be fashioned from the common 
clod under his feet. And for every error and omission 
he must pay the uttermost farthing. It is not so much, 
at this point, a question whether it is to be our people 


or another who win to higher ideals of life, of govern- 
ment and of conduct, as it is whether they are to escape 
the shock of an awakening that must leave them face to 
face with the old struggle for existence, with weakened 
moral fibre and submerged in profound discouragement. 
Certain it is that the time has come for setting our 
household in order, and creating a serious study of 
national activity and economy according to a truer 
insight and a more rational mood. 

The first step is to realize our dependence upon the 
cultivation of the soil. To this end all that has been 
said thus far is contributory. The next will be to 
concentrate popular interest and invention and hope 
upon that neglected occupation. We are still clinging 
to the skirts of a civilization born of great cities. We 
at this very moment use a slang which calls the stupid 
man a "farmer." Genius has shunned the farm and 
expended itself upon mechanical appliances and com- 
merce and the manifold activities whose favourable 
reactions filter back but slowly to the plot of ground 
on which stands solidly the real master of himself and 
of his destiny. If we comprehend our problem aright, 
all this will change; and a larger comprehension of 
agriculture as our main resource and our most digni- 
fied and independent occupation, will for the future 
direct to their just aim, in the improvement of methods 
and the increase of yield, the wisdom and the science 
and the willing labour of the millions who thus may 
transmit to posterity an unimpaired inheritance. 

Agriculture, in the most intelligent meaning of the 


term, is something almost unknown in the United 
States. We have a light scratching of the soil and a 
gathering of all that it can be made to yield by the 
most rapidly exhaustive methods. Except in isolated 
instances, on small tracts here and there, farmed by 
people sometimes regarded as cranks, and at some 
experiment stations, there is no attempt to deal with 
the soil scientifically, generously or even fairly. In 
manufacture we have come to consider small econ- 
omies so carefully that the difference of a fraction of 
a cent, the utilization in a by-product of something 
formerly consigned to the scrap heap, makes the differ- 
ence between a profit and bankruptcy. In farming 
we are satisfied with a small yield at the expense of 
the most rapid soil deterioration. We are satisfied 
with a national average annual product of $11.38 per 
acre at the cost of a diminishing annual return from 
the same fields, when we might just as well secure 
from two to three times that sum. Here is a draft 
which we may draw upon the future and know that 
it will not be dishonoured. Here is the occupation 
in which the millions of the future may find a happy 
and contented lot. 

When we have added to the national export trade 
half a billion dollars per annum, the country rings 
with our rejoicings and we demand the plaudits 
of the world. If a process for extracting metallic 
wealth from rocks were to be discovered to-morrow, 
such as to assure the country an added volume of a 
billion dollars in wealth every year, the nation would 


talk of nothing else. Yet these things would be 
but a trifle when compared with the possibilities of 
agricultural development in the United States. The 
official estimated value of all farm products of the 
country in 1905 was $6,415,000,000. Discount this 
for high prices and generally favourable conditions by 
twenty per cent, and over $5,000,000,000 remain. 
It is also officially recorded that of the appropriated 
farm area of the United States a little less than one- 
half is under cultivation. Utilize the other half and, 
without any change whatever in methods, the output 
would be practically doubled. Change methods only 
a little, not to high-class intensive farming, but to 
an agriculture as far advanced as that of those 
other countries which have made most progress, and 
without any addition whatever to the existing culti- 
vated farm area, the product per acre would be doubled. 
We should be able, by directing surplus population 
to the land, and by the adoption of a system of culture 
in full operation elsewhere, greatly to increase this 
minimum present yield of $5,000,000,000 per annum 
of farm products. That is, we may add $10,000,000,000 
or $15,000,000,000 every year to the national wealth 
if we so choose. And this is but a beginning. 

It will be well, in defence of a prospect so promis- 
ing, to glance at the achievements of other peoples 
upon whom necessity has already imposed wisdom. 
It is, perhaps, not as generally known as it should be 
that Great Britain, with a soil and climate far inferior 
to our own for wheat growing, produces more than 


double the quantity that we do per acre. The average 
for the United States in 1899 was twelve and three- 
tenths bushels per acre. In 1904 it was twelve and 
five-tenths. That is about the figure for a long series 
of years. More than half a century ago the average 
yield in England had risen above twenty-six bushels 
to the acre. In the latter part of the eighteenth century 
agriculture had reached almost its lowest estate in the 
United Kingdom. Men who saw then as we should 
see now the paramount importance of its restoration 
devoted themselves to its advancement. Arthur Young 
made the most complete study of local conditions ever 
attempted. Statesmen were interested and men of 
science enlisted. A board of agriculture was created 
in 1793. Sir Humphry Davy delivered before it in 
1812 a series of remarkable lectures on scientific agri- 
culture. Landed proprietors took up the cry, interest 
was evoked everywhere, new theories were put into 
practice almost as rapidly as the commons were inclosed, 
and between 1770 and 1850 there was an immense 
rise in production, in labourers' wages and in rents. 
Although agriculture in England has suffered in the 
last twenty-five years, by the opening of new land in 
America and the cheapening of the world's transporta- 
tion, it has profited by further advances in knowledge. 
To-day a yield of thirty bushels of wheat per acre is 
about the average for the country. In Minnesota, 
with her fresh soil and unrivalled product, an average 
of fourteen bushels is looked upon with satisfaction. 
The average of Great Britain, applied to the acreage 


in this country, that now gives us something over 
600,000,000 bushels of wheat in a fair year, would 
increase our product to over 1,500,000,000 bushels. 
There are more instructive studies in national effi- 
ciency than this. The German Empire has nearly 
60,000,000 people compressed within a little more 
than 200,000 square miles of territory. She has not 
tied her fortunes to a single interest. Her manufac- 
turing industries are thrusting themselves into the 
markets of every country. How to meet German 
competition is to-day the study of every intelligent 
leader of industry and every cabinet on the Continent 
of Europe. It will be found that a large share of her 
world-wide success is due to symmetrical national 
development. Agricultural industry has not been 
slighted. Behold a contrast that throws light upon 
the idle hosts of England's unemployed, marching 
despondently through streets whose shop windows 
are crowded with wares of German make. Between 
1875 an d 1900 in Great Britain 2,691,428 acres which 
were under cereals, and 755,255 acres which were under 
green crops, went out of cultivation. In Germany 
during the same period the cultivated area grew from 
22,840,950 to 23,971,573 hectares, an increase of five 
per cent.; and the area given over to grass shrank 
one-third. While her foreign trade was making the 
great leap from $1,800,000,000 to $2,650,000,000, the 
yield of her cultivated fields per hectare made the 
following advances, measured in kilogrammes: Wheat, 
from 1,670 to 1,970; rye, from 1,490 to 1,650; barley, 


from 1,480 to 1,950; oats, from 1,070 to 1,840; and 
hay, from 2,230 to 4,450. The wages of agricultural 
labourers rose about twenty-five per cent, between 1873 
and 1892, and have advanced another twenty-five per 
cent, since then. This is the work of intelligence, 
of a complete appreciation of the national problem as 
a whole, of universally practical and technical educa- 
tion and of infinite patience. To agriculture as well 
as to other occupations will apply the conclusion 
reached by Professor Dewar after a study of German 
industry and progress as a whole: "The really appal- 
ling thing is not that the Germans have seized upon 
a dozen industries, but that the German population 
has reached a point of general training and specialized 
equipment and possesses a weapon of precision which 
gives her an enormous initial advantage." 

For half a century Japan has been studying and 
assimilating the best to be found in the world. Japan 
is a world's university for instruction in the art of 
agriculture. Her national greatness is not merely 
built upon that, it grows out of that as the grain itself 
springs from the soil. Of her 45,000,000 people, 
30,000,000 are farmers. The whole body is supported 
by a cultivated area of but 19,000 square miles. Every 
foot of soil is utilized; the farmer is a specialist. For 
twenty-five centuries this nation has turned to tillage 
as the basic industry of life. Her progress is in the 
right direction; growth, like that of the tree, from 
the ground up. The message of the victorious guns 
of Japan is a reminder of the fixed order and pro- 


portion in a healthy national development of industry. 
No nation that does not throw its intensest interest 
and expend the bulk of its force upon the cultivation 
of the soil can become or remain permanently great. 

In France a careful system of agriculture took root 
earlier than in Great Britain, and from it has been 
wrought a far stronger fabric of national prosperity. 
France is to-day the banker nation of Europe. Any 
sound loan can be placed in Paris on short notice. In 
1871 impoverished France was compelled to pay 
$1,000,000,000 to the conquering Germans. Thirty 
years afterward France had $500,000,000 seeking 
for investment. To-day her national debt of 
$6,000,000,000 is practically all held at home, and 
her holdings of foreign securities are not far from 
$15,000,000,000. She controls the purse strings of 
Europe; and Russia and Germany are guided in their 
foreign policies, are urged into or restrained from 
war, not so much by the pleasure of emperor, king 
or kaiser as by the decision of the world-financiers of 
France. The funds for this international financing 
are obtained largely from the savings of the industrious 
and frugal small farmers of France. 

Within the first fifty years of the nineteenth century 
agricultural improvement alone doubled the wealth 
of the country. Landed estates sell to-day for from 
three to four times as much as they brought at the 
time of the Revolution. The valley of the Loire is 
one great garden. Every foot of soil has been studied 
and devoted to the growing of what will produce the 


largest return. Although one-third of the area of the 
country is classified as uncultivable, the tilled portion 
yields food enough for one hundred and seventy inhabi- 
tants per square mile. Kropotkin says, in his remark- 
able study of agricultural methods: "Some thirty 
years ago the French considered a crop quite good 
when it yielded twenty-two bushels to the acre; but 
with the same soil the present requirement is at least 
thirty-three bushels; while in the best soils the crop 
is good only when it yields from forty-three to forty- 
eight bushels, and occasionally the product is as much 
as fifty-five bushels to the acre." From limited areas 
on experimental farms under special care as high as 
eighty bushels per acre have been obtained. But, tak- 
ing cultivation as we find it for the country as a whole, 
the French now draw from the soil more than five times 
as much wealth as they did a century and a half ago. 

This is the result merely of the common agricultural 
industry of France. The strength of the nation, its 
endurance of political changes, its economic place and 
its persistence as a wealth creator are due primarily to 
the fact that it is a nation of small farmers, pursuing 
what in this country would be called intensive, but 
what is really diversified farming. 

It is to Belgium and the island of Jersey that we must 
look if we would see the supreme achievement of care- 
ful farm industry exercised under conditions not 
specially favourable. The agriculture of these countries 
represents a fair average of what the people of any 
other might do, with equal patience, intelligence and 


industry. Originally the soil of Belgium as a whole 
was not highly favourable to cultivation. Yet Belgium 
produces now, after allowing for all imports of food 
products, and exclusive of exports of the same, enough 
home-grown food to supply the wants of four hundred 
and ninety inhabitants to the square mile. This is 
in addition to the large manufacturing industries of 
the country, and offers a fair model and measure of 
what might be done under ordinary conditions with 
the earth by man in any part of the world not cursed 
by sterility. 

These figures, which in reality supply the answer 
to our problem, convict the American farmer of care- 
lessness and want of knowledge, and the economic 
and political leaders of the people of unfaithfulness 
to their trust. To restore and maintain the fertility 
of the soil, to assure food and occupation for a greater 
population than may be expected in a long future, we 
have but to study the experience of older peoples and 
to follow lessons written plainly in the history of the 
world's agriculture. 

There are three essentials in any agriculture worthy 
of the name. The first is rotation of crops. Our 
low average yield is due to the too-prevalent system of 
raising the same crop indefinitely on the same land, 
until it has been worn out or so reduced that the owner 
is in danger of poverty. The yield of a given area may 
be increased and its productive powers preserved from 
exhaustion merely by the restorative variety of change, 
which seems to be a law of all living things. 


Some interesting facts have been brought out by 
the work of the Minnesota State Agricultural School. 
With only ordinary fertilization, and with such farm 
culture as could be applied to large areas, the average 
yield of wheat on the plots under experiment for seven 
years was 26.4 bushels per acre; of oats, 67.2 bushels; 
of corn, 42.8 bushels; and of hay, the average for five 
years was 3.91 tons per acre. This was accomplished 
merely by using a system of five-year rotation; the 
land being treated in this order: corn, wheat, meadow, 
pasture, oats. The figures given are nearly double 
the average yield from the farms of the state. There 
is, therefore, no exaggeration in the statement that our 
farm production could be made two-fold what it is 
by the mere application of more careful methods with- 
out any intensive cultivation whatever. 

If the lands of the state were cultivated according 
to a seven-year system of rotation grain, grain, 
grass, pasture, grain, oats, grain without fertilizers, 
it is estimated on good authority that the same amount 
of grain would be gathered during the four seasons in 
which it appears in this regular order as is now obtained 
from cropping grain every year. That is to say, the 
farmer would obtain at the end of sevenyears exactly the 
same amount of grain that he now takes as the entire 
product of his fields; while in addition he would have 
the whole amount of other crops and of stock for which 
the three seasons of vacation from grain growing would 
furnish opportunity. He would, while preserving 
the fertility of his acres and guarding against soil 


deterioration, add three-sevenths to the volume of his 
material profits. Such is the promise of the simplest 
of all improvements in method. 

This is but the beginning of agricultural possibilities. 
Calling in the aid of the second method of increasing 
yield and preserving soil productivity, which is a more 
liberal use of fertilizing material, such as is possible 
where farms are of small size and cattle are kept, there 
is abundant evidence of the extraordinary results 
that may be obtained. Illustrations may be found 
in every part of the country where individual small 
farmers have had the intelligence to put the system 
into effect. A recent report of the Department of 
Agriculture cites the case of a farm in Pennsylvania 
which was so exhausted as to be incapable of produc- 
tion. This little tract of fifteen acres, devoted strictly 
to dairying and treated each year with every particle 
of the natural fertilizers thus obtained, produces a 
revenue of about $3,000, or $200 per acre, annually. 
There is no secret in the process, just as there is no 
uncertainty in the result. And by a combination of 
judicious crop rotation, which admits and requires 
diversification of farm industry, with careful fertilizing, 
the estimate of a doubled money value for the yield 
of the present farm area of the United States would be 
found under the mark. 

The third factor in improvement, better tillage, is 
most interesting of all because it opens up unmeasured 
possibilities. We no more know what is the maximum 
food-bearing capacity of the earth or of any small 


portion of its surface than we do the rate at which 
people may be able to travel a century from now. 
But what has been done is sufficiently startling. It 
has been seen that a population of 45,000,000 people 
in Japan is supported on 19,000 cultivated square 
miles, aided by the food products obtained from the 
sea. This is because cultivation in Japan is truly 
intensive; that is, it is no longer even highly developed 
farming, but market gardening. As we approach 
that science, the actual creation of soils for grow- 
ing purposes, the shelter of plants from frost and 
unfavourable elements, and the treatment of grains 
and vegetables by separate planting and individual 
nurture, all limitations upon earth's bounty appear 
to recede afar. 

From two and seven-tenths acres in the suburbs 
of Paris there have been grown in a single season 
250,000 pounds of vegetables. A market gardener 
of Paris declares that all the food, animal and vegetable, 
required for the 3,500,000 people of two great depart- 
ments could be grown, by methods already in use, on 
the 3,250 square miles of gardens surrounding the 
city. Thus, while it appears that in Belgium a popu- 
lation of approximately five hundred persons to the 
square mile can subsist on the products of farm industry 
alone, this figure, by high intensive culture, such as 
becomes possible and profitable where population is 
extremely dense, might be more than doubled. 

In one district of East Flanders a population of 
30,000 peasants obtains its food from 37,000 acres 


of ground, at the same time raising thousands of beasts 
and exporting considerable produce. The farmers of 
the island of Jersey, by no means a paradise for the 
agriculturist, manage to obtain an annual agricultural 
product valued at about $250 from each acre of their 
land. In Germany they have produced thirty tons 
of potatoes to the acre. The same has been done in 
Minnesota; and might become the rule rather than 
the exception. The Japanese obtain their yields of 
rice, from twenty to thirty-two bushels per acre in 
poor provinces and sixty to sixty-seven bushels on the 
best land, by separate planting. After the plant has 
been started in a bed it is taken up individually and 
transferred to the field by hand. 

Interesting experiments have been made in the 
United States with wheat. If the best seed be selected 
and planted, and a vigourous young plant be grown, 
four inches distant from its nearest neighbour, it is 
possible, with the most prolific varieties and the utmost 
care, to produce as high as one thousand five hundred 
grains of wheat from a single grain. A yield of one 
hundred grains would be a practical minimum. This 
would give one hundred bushels of crop for every 
bushel of seed; a multiplication now deemed incredible. 
By this method from sixty-two to ninety bushels of 
wheat to the acre have actually been obtained. The 
objection to the amount of labour required may be 
answered by the query whether it would be more dif- 
ficult to grow ten acres after this fashion than a quarter 
section in the old way. And the food demand of a 


population growing by millions is soon to force such 
questions to the front. Even if the soil produces only the 
thirty bushels of wheat to the acre which Great Britain 
can raise, a square mile would grow nineteen thousand 
two hundred bushels. If five hundred persons were 
living on a square mile, it would allot to each one of 
them thirty-eight and four-tenths bushels as a supply. 
Distribute this in terms of any measured food ration 
and it will not be inadequate. 

It may be affirmed with perfect confidence, as a 
conclusion of this brief investigation of soil preservation 
and development, that the possibilities of agriculture 
make it difficult to set any specific limit to the popula- 
tion that could sustain life on the produce of a given 
area. This, however, presupposes cultivation as care- 
fully studied and applied as are the details of manu- 
facturing processes or the manipulations of a chemical 
laboratory. Such must be the ultimate goal of American 
industry. And although the American farmer need 
not yet become a market gardener, it is time to make 
a beginning of better methods. 

From the review given of actual accomplishment 
in treatment of the soil, from the promise of this most 
dependable asset, something may be asserted with 
confidence of our own future. It can be shown that 
an average of two persons or more may be supported 
on every acre of tillable land, by the highest form of 
intensive farming. But dismissing this as unnecessary, 
it has been shown that a people like those of Belgium 
to-day, not an Oriental race accustomed to a standard 


of living and of labour inapplicable to us, not living 
in virtual serfdom like the peasants of Russia, but an 
industrious, fairly intelligent and exceedingly com- 
fortable agricultural community, can raise from the 
soil food enough for the needs of four hundred and 
ninety persons to the square mile. 

Adopting provisionally that ratio as a point of 
departure, though the actual ratio of area to population 
gives a figure considerably higher even than this, the 
414,498,487 acres of improved farm lands in the United 
States on the date of the last official report, an area 
materially enlarged by the present time, would support 
in comfort 317,350,405 people; enabling them at the 
same time to raise considerable food for export and to 
engage in necessary manufacturing employments. 
Applying the same ratio to the entire acreage of farm 
lands within the United States, both improved and 
unimproved, which was at the same date 838,591,774, 
the population indicated as able to live with comfort 
and prosperity on the actually existing agricultural 
area of this country, under an intelligent system and 
a fairly competent but by no means highly scientific 
method of culture, rises to 642,046,823. 

The conclusion is that, if not another acre were to 
be redeemed from the wilderness, if the soil were 
treated kindly and intelligently, if industry were dis- 
tributed duly and popular attention were concentrated 
upon the best possible utilization of the one unfailing 
national resource, there would be produced all necessary 
food for the wants of, in round numbers, 650,000,000 


people. But this means such study and labour to 
raise production to its highest terms as have entered 
scarcely at all as yet into the American comprehension. 

Failing to understand the needs of the hour or to 
appreciate the moral to which they point, what fortune 
must await us ? Within twenty years 125,000,000 
people, and before the middle of the century over 
200,000,000 people, must find room and food and 
employment within the United States. Where are 
they to live ? What are they to do ? By that time 
our mineral resources will have been so nearly exhausted 
that the industries built on them must fall into a minor 
place. By that time it is apparent that our dream 
of a conquest of world markets will be a burst bubble. 
Mr. Harold Bolce has demonstrated that the peoples 
of the Orient, the hundreds of millions of Japan and 
China, with their imitative quality, their proved ability 
to operate modern machinery and to create it in their 
workshops after once using it, their enormous supply 
of coal and iron, their limitless cheap labour and their 
patience like that of Fate, are prepared to control 
the markets of the future. They must control as 
against a policy which has established in manufactur- 
ing business domestic conditions making production 
so expensive an affair that we could not hope to meet 
the mechanic of Germany on even terms and must 
retire before the despised Chinaman. 

It is a mathematical fact that within twenty years 
under present conditions our wheat crop will not be 
sufficient for home consumption and seed, without 


leaving a bushel for export. Will these coming mil- 
lions go into the factories ? But where can we then 
expect to sell shop products in a world competition, 
and who will furnish the payrolls ? All industry stops 
when these are not forthcoming. That is the dead- 
wall before which England stands dismayed. The 
shops are there, the workingmen are there clamouring 
for employment, but capital can find no profit in the 
enterprises, nobody offers to advance money for the 
payrolls of unprofitable business, and a top-heavy 
industry surely falls. 

Let us be warned in time. On every side there is 
menace if our national activity be not reorganized on 
the basis of old-fashioned common sense. The safety 
valve for older peoples has been found in emigration. 
Their relief has contributed to our danger. The 
United States cannot follow their example. It is 
against the genius of our people; and besides, the 
circle of the northern hemisphere is closed. At home 
the problem must be worked out; and its terms have 
been clearly stated. 

The conclusion reached points out and empha- 
sizes a national duty so imminent and so imperative 
that it should take precedence of all else. Our foe 
is one that has overthrown civilizations as proud, as 
prosperous and far more strongly fortified than our 
own. Nothing can stop the onward march of nature's 
laws or close the iron jaws of her necessities when they 
open to crush their victims. Either we shall under- 
stand our situation and make such provision as her 


benignancy affords to meet it, or we shall meet con- 
ditions of overcrowding and artificial standards and 
food and employment inadequate to the national 
needs, and so be in danger of destroying the stately 
temple once reared with the highest hopes that ever 
animated humanity. Which is it to be ? 

If we are to walk safely in the way of wisdom, there 
is much to be done. It is time to begin. There must 
be, first, a return to conservative and economic methods; 
a readjustment of national ideas such as to place agri- 
culture, and its claims to the best intelligence and the 
highest skill that the country affords, in the very fore- 
front. There must be a national revolt against the 
worship of manufacture and trade as the only forms 
of progressive activity, and the false notion that wealth 
built upon these at the sacrifice of the fundamental 
form of wealth production can endure. A clear recog- 
nition on the part of the whole people, from the highest 
down to the lowest, that the tillage of the soil is the 
natural and most desirable occupation for man, to 
which every other is subsidiary and to which all else 
must in the end yield, is the first requisite. Then there 
will be a check administered to the city movement 
that lowered the percentage of agricultural labour to 
the whole body of persons engaged in gainful occu- 
pations in the United States from forty-four and 
three-tenths in 1880 to thirty-seven and seven-tenths 
in 1890 and to thirty-five and seven-tenths in 1900. 
With public interest firmly fixed upon the future, 
the country, in mere self-preservation, must give serious 


attention to the practical occupation of restoring 
agriculture to its due position in the nation. 

The Government should establish a small model 
farm on its own land in every rural congressional 
district, later perhaps in every county in the agricul- 
tural states. Let the Department of Agriculture show 
exactly what can be done on a small tract of land by 
proper cultivation, moderate fertilizing and due rota- 
tion of crops. The sight of the fields and their contrast 
with others, the knowledge of yields secured and profits 
possible, would be worth more than all the pamphlets 
poured out from the government printing office in 
years. The Government ought not to hesitate before 
the comparatively small expense and labour involved 
in such a practical encouragement of what is the most 
important industry of our present and the stay and 
promise of our future. Disseminate knowledge of 
farming as it should and must be, instead of main- 
taining the pitiful bribe of a few free seeds. Declare 
everywhere, from the executive chamber, from the 
editorial office, from the platform, and, above all, 
from every college class-room and from every little 
school-house in the land, the new crusade. Let the 
zeal for discovery, for experiment, for scientific advance- 
ment that has made the last century one of multiplied 
wonders focus itself upon the problems of the oldest 
of sciences and arts; the corner stone of all civilization 
- the improvement of tillage and making grow two 
grains where only one grew before. Only thus may 
a multiplying population secure its permanent main- 


tenance. Only thus may the struggle for existence 
that has power to either curse or bless be brought to 
any other termination than the peace of death. 

I have not drawn upon fancy for a single detail 
of this picture. This growing increase of population, 
its rise to over 200,000,000 before 1950, the approach- 
ing exhaustion of much of our mineral wealth, the 
vanishing of our public domain, the deterioration 01 
our soil, the terrible need which these must bring, 
the strain on institutions and the stress of indus- 
trial perplexity or decline are as certain as the passage 
of the years. I have given the facts, drawn from 
authentic sources, and in every case under rather than 
over stated. Let them be examined, criticised, com- 
pared with official records. For this is not a contro- 
versy about theories, but a plain statement of natural 
facts in the light of nature's laws. Then let the 
statesmen, the writers and the thoughtful workers 
of to-day say if they are not true. If true, what are 
we to do ? Where, save in a concentration of national 
effort upon that first and last resource of man ever 
since he left Eden, is there a sure escape and a safe 
relief? Let the leaders of men give their answer. 

The situation is not at all hopeless or even desperate 
if the nation turns to its task with appreciation, with 
wisdom and with courage. The saving qualities of 
the American people are intelligence, adaptability 
and patriotism. Given a situation, simple or complex, 
demanding sacrifice or promising reward, they are 
quick to comprehend it and to mobilize their forces 


for its mastery. If they turn with comprehension of 
their situation manfully to the most vital work of the 
present, our children's fortunes may be made secure. 
Instead of a world filled with human beings struggling 
against advancing necessity, instead of the grim choice 
between the slow but sure decline to an ever-lowering 
scale of comfort, there appears a beautiful conformity 
to nature^s order and the blessing of service to her 
law. This country may easily become the happiest 
and most favoured portion of the earth, the sure refuge 
and defence of the destitute and oppressed, because 
of its mighty heritage of that one resource which may 
increase and be replenished as the ages roll by. This 
is not the conception of a new Arcadia or a return 
of the golden age. Industry will sufficiently diversify 
itself, once the order of it is rescued from a false appre- 
ciation and restored to that found on nature's roll 
of honour. 

In the last census year the value of agricultural 
products was less than $5,000,000,000. But the farm 
products of thatyear devoted to manufacturing uses were 
valued at $2,679,000,000; the product of the industries 
using these materials was $4,720,000,000; and in 
these industries, capitalized at over $4,000,000,000, 
there were 2,154,000 persons employed. A profit- 
able husbandry is the very fountain from which all 
other occupations flow and by which they are nourished 
in strength. A symmetrical development of industry 
is by no means the least important reward of a readjust- 
ment of industrial occupations and interests in harmony 


with their real relation to man and his active life upon 
this planet. Not lessened but enhanced and greatly 
varied industry in the end will follow the rearrangement 
and restoration of industrial values. 

Now as ever, to the nation and race as to the individ- 
ual, nature, the unrelenting task-mistress of the 
centuries, holds out in one hand her horn of plenty 
and in the other her scourge. This country has 
brought itself within reach of the thong, while grasp- 
ing at the satisfaction of present appetite and forgetting 
the primal relation between the earth and man. The 
pathway to prosperity is still open. The divinity 
of the earthly life at heart is kind. Under her rule 
there is work and abundant reward for all, but these 
must be won in her designated way and in none other. 
Her pointing finger, that has never varied since man 
came upon the earth, shows the old and only way to 
safety and honour. Upon the readiness with which 
this is understood, the sober dignity with which a 
whole nation rises to the winning of its broad and 
permanent prosperity, will depend the individual 
well-being of millions of this and many generations. 
Largely by the result will posterity, our fit and 
righteous judge, determine whether what issues from 
the crucible of this twentieth century is a bit of worthless 
dross to be cast aside or a drop of golden metal to shine 
forever upon the rosary of the years. 


EJD without population is a wilderness, and 
population without land is a mob. The 
United States has many social, political and 
economic questions, some old, some new, to settle in 
the near future; but none so fundamental as the 
true relation of the land to the national life. The first 
act in the progress of any civilization is to provide 
homes for those who desire to sit under their own vine 
and fig tree. 

A prosperous agricultural interest is to a nation what 
good digestion is to a man. The farm is the basis of 
all industry. The soil is the only resource that renews 
itself continually after having produced value. I do 
not wish to belittle the importance of manufacture 
or its relative value in general growth. But for many 
years this country has made the mistake of unduly 
assisting manufacture, commerce and other activities 
that centre in cities, at the expense of the farm. The 
result is a neglected system of agriculture and the 
decline of the farming interest. But all these other 
activities are founded upon the agricultural growth of 
the nation and must continue to depend upon it. Every 
manufacturer, every merchant, every business man, 



every good citizen is deeply interested in maintain- 
ing the growth and development of our agricultural 

It is strange that almost all countries, including our 
own, should, until taught by approaching misfortune, 
fail to realize the primary and indispensable place of 
agriculture in sound national development. Probably, 
as both industry and society grow more complex, we 
lose sight of their plain connection with the soil, just 
as some of the most baffling diseases with which modern 
medical science has to deal originate in violations of 
the simplest and most ancient laws of health. At any 
rate, it is but recently that there has been revived 
somewhat in this country a sense of the dependence 
of all progress, of national prosperity and individual 
existence upon the land and its proper care. We do 
not even yet feel the force of this old law as we should 
and must. Some other peoples, equally intelligent, 
appear to have almost lost sight of it, although accept- 
ing it heartily in earlier ages, when there were fewer 
great interests to distract attention and confuse judg- 

One hundred and fifty years ago Dr. Samuel John- 
son, one of the closest observers and most philosophic 
thinkers of the English race up to his time, wrote these 

"Of nations, as of individuals, the first blessing is 
independence. Neither the man nor the people can 
be happy to whom any human power can deny the 
necessaries or conveniences of life. There is no way 


of living without the need of foreign assistance but by 
the product of our own land, improved by our own 
labour. Every other source of plenty is perishable 
or casual." 

Comparing other leading national interests with 
this, he said: 

"Trade and manufactures must be confessed often 
to enrich countries . . . but trade and manufac- 
tures, however profitable, must yield to the cultivation 
of lands in usefulness and dignity. . . . Mines 
are generally considered as the great source of wealth, 
and superficial observers have thought the provision 
of great quantities of precious metals the first national 
happiness. But Europe has long seen, with wonder 
and contempt, the poverty of Spain, who thought her- 
self exempted from the labour of tilling the ground, 
by the conquest of Peru, with its veins of silver. Time, 
however, has taught even this obstinate and haughty 
nation that without agriculture they may, indeed, be 
the transmitters of money, but can never be the pos- 
sessors. . . . Agriculture alone can support us 
without the help of others, in certain plenty and genuine 
dignity. Whatever we buy from without, the sellers 
may refuse; whatever we sell, manufactured by art, 
the purchasers may reject; but while our ground is 
covered with corn and cattle, we can want nothing; 
and if imagination should grow sick of native plenty, 
and call for delicacies or embellishments from other 
countries, there is nothing which corn and cattle will 
not purchase. . . . This, therefore, is the great 
art, which every government ought to protect, every 
proprietor of lands to practise, and every inquirer into 
nature to improve." 


These are great truths set in great words. If Dr. 
Johnson could revisit his country to-day, he would find 
his argument vindicated and his vision justified by an 
alignment of industries so uneven and a balance so 
poorly maintained that business in the streets of her 
cities is impeded by processions of gaunt men shouting 
in wretched concert, "We want work! We want 
work!" He would find her legislators trying to alle- 
viate symptoms by socialistic nostrums, instead of 
striking at the disease itself. He would find even her 
industrial supremacy in many directions, once based 
upon the prosperity of the small farmer, passing away 
or jeopardized. In the west of England, which was a 
great centre of broadcloth manufacturing and of the 
weaving of other woollen goods, their output is less 
than a quarter of what it was twenty-five years ago. 
Germany is taking the cutlery trade of Sheffield. The 
German people, who have cared jealously for their 
farming industry at the same time when they were 
learning economy and efficiency in all other forms of 
production, to-day lead the world, or any period in 
its history, in scientific industrial intelligence and sys- 
tematic management. 

In view of such contrasts it is most important that 
our own country should realize the situation and take 
thought for its own future. When the United States 
shall have from 150,000,000 to 200,000,000 people, 
they must be employed; they must earn a living. How 
will their occupations and products stand in relation 
to one another? Will there be mutual internal sup- 


port, or mutual destruction and decay ? Who will 
employ these millions ? Who will buy the goods they 
produce ? In what shape will they be to meet the 
competition that England faces to-day ? Hosts of 
idle men in Great Britain ask for the opportunity to 
win bread by work, and there is nothing for them but 
the dole of charity. We must avoid for all time that 

With our magnificent areas and the relative sparse- 
ness of our population as compared with the more 
densely peopled countries of the Old World, the time 
of economic trial should be a long way off for us. With 
greater wisdom than we have exercised in the past it 
may never come. But we must preserve jealously 
the right and the possibility of free access to the soil, 
out of which grow not only all those things that make 
happy the heart of man and comfort his body, but 
those virtues by which only a nation can endure, and 
those influences that strengthen the soul. This is 
the safe-guard not only of national wealth but of 
national character. The fertile fields of this country 
are its real gold mines, from which it will gather a 
richer yield than the deposits of Alaska or South Africa 
or any other land can furnish. These are the true 
national inheritance. We must treasure what is left 
of them. Ever since the first settlements at James- 
town and Plymouth Rock, the United States has had 
an unlimited domain where men might find homes. 
Now it is all fairly occupied. Fifty-two years ago, a 
hundred miles from Chicago there was an unoccupied 


prairie. Now the land from the Mississippi Valley 
to the Pacific is opened up and populated, and the 
wave of emigration is turning back and filling the places 
that were passed over. 

For the first time in the history of this country thou- 
sands of farmers from states like Iowa, Kansas, 
Missouri, Michigan, Wisconsin and Minnesota are 
seeking homes in the Canadian Northwest, owing to 
the cheap lands offered there and the difficulty of secur- 
ing such lands in the United States. Toward saving 
a supply for the future something is now being done. 
We are at least saving at the spigot, though we have 
not quit wasting at the bung. While we are spending 
great sums to transform worthless lands into orchards 
and gardens by the work of the reclamation service, 
we still retain as to other areas the land laws under 
which for many years the great heritage of the 
people has been passing so largely into unworthy 

For the sake of our national future, for the sake of 
the coming millions who will be helpless unless each 
can be furnished with a piece of tillable land as a defense 
against misfortune, we should see that the speculative 
abuses which these laws have fostered are brought to 
an end. It should not be possible to obtain public land 
of any kind anywhere in the United States henceforth 
except after complying with all the terms of the home- 
stead law. I cannot urge too strongly upon every 
man who wishes his country well and who desires all 
to be prosperous in order that he may prosper with 


them, the importance and growing necessity of taking 
such care of our public domain as shall preserve the 
remnant of it for the use of generations yet unborn. 

Such close and careful cultivation as will yield the 
highest profit per acre can best be given to land when 
it is cultivated in comparatively small farms. The 
greater the number of prosperous farmers, the greater 
will be the prosperity of every business man. It takes 
more labour to earn the same profit from a tract too 
large to be tilled thoroughly. Ten farmers, each 
cultivating from forty to one hundred and sixty acres 
at the outside, with the most approved methods, sup- 
plemented where necessary by irrigation, can each 
earn a profit equal to that taken from two or three 
times the same area by slovenly tillage. Ten farmers 
instead of one increase the aggregate volume of trade 
with the merchants of the community and add in the 
same ratio to the general prosperity. 

Following unconsciously this law, many of the 
bonanza wheat farms of earlier days have been or are 
being broken up into smaller holdings. It is certain 
that in every state farm lands will ultimately be divided 
and subdivided until each farmer has only so much 
as will yield him an ample reward for his labour and 
enable him to support his family in comfort. Our 
agriculture will take a place midway between the 
miniature garden-farm of Japan and the vast estates 
of countries that still support a landed gentry. It is 
far better that it should be so. The farm life of the 
future will have many advantages some of them 


already beginning to be realized over the isolation 
of an earlier day; because the multiplication of smaller 
farms has begun to bring good roads, schools, near 
neighbours, farm telephones, churches, libraries, 
improved mail facilities and a social environment 
which is impossible where farms are so big that homes 
are far removed from one another. 

Including Alaska, this country has about the same 
area as Europe. It has a little more than one-fifth as 
much population. With a trifle over 5 per cent, of 
the population of the world, we are producing 43 per 
cent, of the world's supply of wheat, corn and oats. 
We raise over 70 per cent, of the world's cotton. All 
political economy that is not mere empty theory rests 
upon the ratio of population to land area, the abund- 
ance and value of the products of the soil, and the 
proper balance and inter-relation of different indus- 
tries. We have been busy as a nation helping the 
so-called industrial interests of the country in fact, 
everybody except the man on the farm. 

But when we have as many people to the square 
mile as Europe has now, we will know the economic 
troubles of Europe. Our task will be to increase 
correspondingly the volume of the earth's product. 
When we get down to business and take stock of those 
national affairs in which we are vitally concerned as 
workers and home-builders, as citizens and as fathers 
of the children who are to make our future, we find 
that the main thing is the utilization and conservation 
of the soil and the resources drawn from it. This 


interest must more and more take precedence of all 
others. The man must be encouraged to go to the 
farm. The man on the farm must be considered first 
in all our policies, because he is the keystone of the 
national arch. When he has produced the share of 
natural wealth that corresponds to his best effort, he 
must be able to find a purchaser at prices that will 
enable him to live in comfort and enjoy at least a mod- 
erate degree of prosperity. This has been the final 
test of every country and every civilization; and it will 
no more change than the seasons are likely to reverse 
the order of their succession. 

History makes all this a twice-told tale. As far 
back as we know anything about civilization, the 
cultivation of the soil has been the first and most 
important industry in any thriving state. It always 
will be. Herodotus, the very father of history itself, 
tells the story of the human race in the valley of the 
Euphrates. He says that with poor cultivation those 
who tilled the soil there got a yield of fifty fold, with 
fair cultivation one hundred fold, and with good culti- 
vation two hundred fold. That was the garden of 
the world in its day. Its great cities, Babylon and 
Nineveh, where are they ? Piles of desert sand mark 
where they stood. In place of the millions that overran 
the world there are a few wandering Arabs feeding 
some half-starved sheep and goats. The Promised 
Land the Land of Canaan itself to which the 
Children of Israel were brought up from Egypt, what 
is it now ? A land overflowing with milk and honey ? 


To-day it has neither milk nor honey. It is a barren 
waste of desert, peopled by scattered robber bands. 
A provision of Providence fertilized the soil of the valley 
of the Nile by overflowing it every year. From the 
earliest records that history gives, Egypt has been a 
land of remarkable crops; and to-day the land thus 
fertilized by overflow is yielding more abundantly 
than ever. 

It is made clear by every process of logic and by the 
proof of historic fact that the wealth of a nation, the 
character of its people, the quality and permanence 
of its institutions are all dependent upon a sound and 
sufficient agricultural foundation. Not armies or 
navies or commerce or diversity of manufacture or 
anything other than the farm is the anchor which will 
hold through the storms of time that sweep all else 

Our agricultural population will compare favour- 
ably with any in the world; but it must be taught to 
honour its occupation and to make that occupation 
worthy of honour. 

Elsewhere I deal with the substitution of new 
methods of tillage for old, by which the average crop 
return of the country might be doubled, and over 
eight billion dollars be added annually to the nation's 
wealth. As they learn how this may be done, the 
farmers of the nation will realize more fully the dig- 
nity, the independence and the comfort of their calling. 
Their children will understand that the farm is not a 
prison from which they should escape at the first oppor- 


tunity, recalling its surroundings only with aversion 
or contempt, but the real bulwark of liberty and the 
home of happiness. There can be no greater aid 
toward the maintenance of a prosperous, free and 
enlightened nation than the inculcation of the precept, 
" Keep the children on the farm/' 

In 1790 only about 3.4 per cent, of the American 
people lived in towns. At the time of the Civil War 
the percentage had risen to 16. In 1900 more than 
31 per cent, of our population was urban. The census 
of 1870 was the first to group the population of ten 
years old and upward in great divisions according 
to occupation. The drift away from the land became 
pronounced in 1880. Since then the process has been 
continuous and the results cumulative. The per- 
centage engaged in agricultural pursuits of the whole 
number of persons ten years old and upward engaged 
in gainful occupations in this country is as follows 
by decades: 

1870 47.36 

1880 44.3 

1890 37.7 

1900 35.7 

From all the states, East and West alike, comes 
the complaint that the children will not stay on the 
farm, and that other labour cannot be enticed there 
except by high wages for a few weeks in summer. It 
is quite probable that the new census will show this 
farm population reduced to 30 per cent, of the whole. 
Certainly it does not exceed one-third. And, unless 


this tendency is counteracted, no one can now predict to 
what inconsiderable fraction it may one day decline. 
Totals of farm products expressed in dollars and those 
expressed in bushels or pounds tell quite different 
stories. We maintain the financial showing because 
new and fertile land is still being opened, while at the 
same time older lands are abandoned or deteriorate. 
The possibility of this disappears with the appro- 
priation of most of our available unoccupied land. 
The further fact is that we are now and have been 
for more than a generation, in spite of our boasted 
progress, in the grip of a revolution that has preceded 
declining wealth and falling institutions wherever it 
appeared since history began. 

If, in a population of 100,000,000 people, which 
we shall have shortly, 45 per cent, are engaged in 
agriculture, then 45,000,000 people are calling upon 
the labour of 55,000,000 for clothing, professional 
service, commercial help, tools and furniture and all 
the smaller comforts and luxuries. If, instead, the 
agricultural percentage is reduced to 30, only 
30,000,000 people instead of 45,000,000 people make 
such demands, while 70,000,000 instead of 55,000,000 
compete in supplying them. A stationary or declining 
product, a soil becoming annually less productive, a 
revolt against the life of the farm and a consequent 
rise in wages amounting, since 1895, to 55-6 P er cent, 
for ordinary day labour on the farm without board and 
61.3 per cent, with board, compel such a rise of 
prices as bears ruinously upon town and country alike. 


Our real concern is not so much to save the home 
market from the inroads of the foreigner as to keep it 
from destruction by an enlarged city life and a neglected 
country life, a crowded artisan population clamouring 
for food and a foreign demand for the product of their 
wages limited to fields where the competition of all 
the world must be met and overcome. 

Civilization is mostly the story of the triumph of 
the human stomach in its struggle for food sufficient for 
the work of physical and mental evolution. Events 
and epochs that puzzled the historians of the past 
are explained by a study of common human experience. 
An economic cycle runs through all the affairs of men 
from the earliest times. There is a period of founda- 
tion laying, in which agriculture is the accepted resource 
of the state and national strength is built upon it. Then 
the demand for an enlarged life stimulates the manu- 
facturing and the commercial interests, and there 
ensues a period of great prosperity, which sees the 
rise of great fortunes, the relative decline of the food 
supply, the introduction of luxury, the growth of 
indolence and a universal increase in prices. Never 
yet has this enhanced cost of living, when due to 
agricultural decline and inability to supply national 
needs, failed to end in national disaster. Professor 
Ferrero, in his story of the Greatness and Decline 
of Rome, after describing the agricultural depression 
of Italy, the ruin of her peasantry and the distress of 
all classes that followed, attributes it "simply to the 
increased cost of living." This, rather than imperial 


ambition or race decay, is the key by which history 
unlocks the secrets of the past. 

This country has from the beginning established 
and maintained a common school system on the 
sound principle that education is essential to a right 
discharge of the duties of citizenship. Another ele- 
ment must be introduced into the educational system. 
To direct the minds of the young to work upon the 
land as an honourable and desirable career, and to 
prepare them for work when they return there by 
suitable instruction, is to promote good citizenship 
and national security. To raise the productivity of 
our soil 50 per cent, would be an increase greater in value 
than the entire volume of our foreign trade. These 
results can be brought about only by a general under- 
standing and practice of agriculture as modern science 
and experiment work explain it; by such instruction 
as we now give in our technical schools and institutes 
for the trades. Any one who has studied the growth 
and decline of nations and would read our own indus- 
trial future must be convinced that instruction in farm 
economy and management should become an indis- 
pensable part of the educational work of this country. 

In addition to all that those of our schools where 
farming is taught are doing, and all that ought to be 
done, there should be speedier and more direct work 
for the immediate improvement of the agricultural 
interest. The older generation, and those of the new 
who have not been adequately taught, should have 
abundant object lessons. 


If 1 could have my way I should build a couple of 
warships a year less. Perhaps one would do* I would 
take that $5,000,000 or $6,000,000 a year and start at 
least one thousand agricultural schools in the United 
States at $5,000 a year each, in the shape of model 
farms. This model farm would be simply a tract of 
land conforming in size, soil treatment, crop selection 
and rotation and methods of cultivation to modern 
agricultural methods. Its purpose would be to furnish 
to all its neighbourhood a working model for common 
instruction. Cultivating, perhaps, from forty to sixty 
acres, it could exhibit on that area the advantages of 
thorough tillage which the small farm makes possible; 
of seed specially chosen and tested by experiment at 
agricultural college farms; of proper fertilization, 
stock raising, alternation of crops and the whole scien- 
tific and improved system of cultivation, seeding, 
harvesting and marketing. The farmers of a county 
could see, must see, as they passed its borders how 
their daily labours might bring increased and improved 
results. The example could not fail to impress itself 
upon an industry becoming each year more conscious 
of its defects and its needs. As fast as it was followed, 
it would improve farm conditions, make this a form 
of enterprise more attractive to the young and the 
intelligent, and add enormously to the volume of farm 
products which constitutes our enduring national 

The experiment would cost but a fraction of the 
amount sometimes given freely for more questionable 


purposes. It would require a small amount of land, 
all told, to place a model farm in every agricultural 
county in the United States. There should be a trained 
man to each farm of, say, eighty acres; and a general 
superintendent, a thoroughly trained agriculturist, to 
manage three of four counties and visit the different 
farms. All such farms in a state might be put under 
the general supervision of the agricultural college in 
that state, as a part of its experimental work. Results 
reached by this arrangement would have the conclu- 
siveness of a demonstration in science. Every crop 
that could be or ought to be raised should be experi- 
mented with, not at some distant spot seldom visited, 
but right at home on the farm. I would bring the 
model farm into every agricultural county; and if any 
farmer was in doubt, he could visit it, see with his 
own eyes, and find out what he ought to have done 
and what he could do next time. It would do for the 
farming population what the technical school does for 
the intending artisan, and the schools of special train- 
ing for those who enter the professions. Side by side 
with the common school it would work for intelligence, 
for progress, for the welfare of the country in a moral 
as well as a material aspect. 

Perhaps even this is not all that should be done; 
and perhaps we need to move even more quickly and 
effectively. Formerly the decreased productivity of 
our older lands, due to poor cultivation, was more 
than made good by large yields from the immense 
acreage of new land continually being brought under 


the plough. This cannot be true in the future. If the 
average yield per acre of old land continues to fall as it 
has in the past, the total national product will soon begin 
to decline. The additional demand of a constantly 
increasing population, added to this deficit, compels 
us to consider at once the only practical remedy the 
raising of the product of the land per acre by methods 
already broadly outlined and to be considered in more 
detail in the following chapters. 

We cannot wait for the work of the agricultural 
colleges; because the emergency is one not for the 
next generation, but for this. Instruction in improved 
methods should be carried to the farmer, just as he is, 
upon his own farm. The state might profitably 
employ a considerable number of men educated in 
practical agriculture; supply them with seed selected 
for quality; send them out to the farms and have each 
farmer put in a few acres, under the direction of its 
agents, sowing and tilling these according to their 
instructions. The great increase in both the quantity 
and the quality of the yield would be a convincing 

When we set out to educate the children in the 
public schools, we do not establish one or two large 
ones in each state and expect them to go there. The 
farmer is almost as numerous, as much in need of 
instruction and as unable to leave home in search of 
it or to absorb it through literary channels as the child. 
If all the graduates of all the Agricultural Colleges 
were sent out as missionaries to the farm, there would 


not be enough of them to do the work. But it is the 
sort of work in which every state should engage with- 
out delay. 

What has to be taught is not abstruse. While 
highly scientific farming can furnish employment for the 
best intelligence, instruction in a few simple subjects 
will enable the ordinary farmer to double his product. 
He needs to be taught how to prepare a field properly 
for the seed; how to select and where to get the seed 
that will yield the best return; how to cultivate each 
crop; how to combine stock raising with tillage; and 
how to rotate his crops and preserve unimpaired the 
richness of his soil. On his own farm, with the mate- 
rial and the object lesson before him, under instruc- 
tion that comes with public authority and sanction, he 
will be a pupil apt to learn. It is on a par with the 
importance of the public school. We have not yet 
made a beginning; but every other interest and every 
other item of proposed legislation might well wait until 
we do. 

National wealth and all the activities concerned in 
its production and distribution depend, we see, upon 
the soil. So do the political fortunes of nations. In 
1889 seventy years after Great Britain started on her 
era of expansion, one of the oldest banking houses in 
Great Britain failed. Who came to her aid ? France, 
after paying a thousand millions war indemnity to 
Germany, came to the relief of Great Britain; and 
to-day if any power in Europe thinks of engaging in 
war, it first sounds carefully the opinion and disposi- 


tion of the bankers of France. Again it is interesting 
to refer to a judgment a century and a half old. In 
the paper before referred to, Dr. Johnson makes this 
shrewd comparison between France and Spain: 

"It is well known to those who have examined the 
state of other countries that the vineyards of France 
are more than equivalent to the mines (gold and silver) 
of America. . . . The advantage is indeed always 
rising on the side of France, who will certainly have 
wines when Spain by a thousand natural or accidental 
causes may want silver." 

Spain is to-day a beggar among the nations. To 
the fruit of the vine France has added a thousand 
other products of her fertile fields and gardens; but 
still her main reliance is upon agricultural wealth. It 
has made her the great creditor nation of the world. 
Comparative history points to agriculture and its 
varied fortunes as a powerful producing cause in the 
rise and fall of nations. 

Professor Ferrero, scanning the history of more 
than twenty-five hundred years with the eye of the 
philosopher, determined to extract from this vast 
store of facts, according to the modern scientific method, 
some fixed principle in the affairs of men, announces 
this conclusion: "The only durable conquests, even 
in ages of barbarism, are conquests made by the 
plow." If this was true of the rude ages when men 
lived for the sword, and the tiller of the earth was 
either a slave or a still more wretched peasant, it is 
far truer to-day when civilization has built her impos- 


ing fabric upon the expected bounty of the earth. We 
must maintain, protect and extend these conquests 
by which the race has won its way. It is not, as in the 
old mythology, Atlas whom we see groaning beneath 
the weight of the world upon his shoulders, but the 
homelier and humbler figure of the cultivator of the 
soil. It is for each of us, in every capacity, public and 
private, to do what in us lies to enlighten, reinvigorate 
and sustain this common benefactor of our kind. 


IT IS in order now to consider more in detail just 
what constitutes a system of tillage scientific in 
its methods and satisfactory in its results; to set 
forth how far and why we have fallen short of attaining 
it in the past, and what the failures and successes of 
ourselves and others have to teach us for the future. 

We have begun to realize only recently that farming 
is to a great extent an exact science. The man no 
longer deserves the name of farmer who conceives of 
his industry as a scratching of the earth, a hit-or-miss 
scattering of seed and a harvesting of such yield as 
soil and weather may permit. That is not farming, 
but a game of chance. After an army has been raised 
and before it can enter upon any campaign, the first 
consideration is to provide its food. If that is a fail- 
ure, the bravest and best-organized force will melt 
away in a week. Our national supply of food, in 
like manner, is fundamental to the organization of 
our social life and to the progress of all our industries. 

It is as well assured as any future event can be that 
the population of the United States will be 200,000,000 
by about the middle of the present century, or in less 
than fifty years. It may come a few years later or a 



few years earlier, according to circumstances, for good 
times lift both the immigration total and the domestic 
birth rate, while depression decreases both, but this 
is immaterial. Millions of persons now living will 
see the 200,000,000 people here; and the first question 
is, How are they to be fed ? There will be many grave 
problems accompanying such human growth, but we 
may for the time being dismiss all the others until we 
have considered the primary one of the bare main- 
tenance of life. The food problem itself has numerous 
collateral issues, but for the sake of simplicity we may 
here consider only the matter of bread. Where and 
how are we to obtain loaves enough to feed these com- 
ing millions ? 

The average yearly consumption of wheat per capita 
varies considerably with seasons and prices, but it 
rises steadily with our constantly advancing standard 
of comfort. Of late it has been either slightly under 
or slightly over seven bushels for bread and seed. 
Suppose that it is six and one-half bushels per capita, 
which is certainly within the mark. It will then 
require, unless we are to fall to a lower scale of 
living, a total product of 1,300,000,000 bushels of 
wheat for our bread supply, if we did not export any. 
From 1880 to 1906 inclusive, our crop averaged 
521,738,000 bushels annually. Twice only before 
1909 have we exceeded 700,000,000 bushels. It is 
fair to say that 650,000,000 bushels is our present 
average capacity. Of course, with an increasing 
population may come a somewhat increased total 


production, though it will not advance as rapidly as 
many suppose. We grew 504,185,470 bushels in 1882, 
when our population was a little over 52,000,000, and 
634,087,000 bushels in 1907, twenty-five years later. 
The increase in wheat yield during these years, when 
much of the new land of the West was being brought 
under cultivation, was a little over 25 per cent., while 
population increased 33,000,000, or over 63 per cent. 
Obviously, bread supply and demand will not keep 
pace through the working of any law of nature. 

Moreover, possible increase of wheat production by 
increasing acreage is limited. We have no longer 
a great area of free public lands. Some wheat will 
be grown on reclaimed arid land, though this is mostly 
devoted to the raising of fruit and fodder plants. Some 
lands will be drained, and there are a few acres of 
public land left on which wheat may be raised. But 
a denser population makes new demands upon the soil; 
and it is more likely on the whole that wheat acreage 
will be reduced, to raise all the other food supplies 
consumed by 200,000,000 people, than that it will be 
enlarged. Nothing but a material rise in price could 
accomplish this; and we may, perhaps, assume that 
a steady and certain price of one dollar or one dollar 
and a half per bushel would raise, with better work on 
the farm, our total annual wheat product to 900,000,000 
bushels, which would be 50 per cent, more than the 
present average. This is the extreme limit of prob- 
ability. The country could do no more, with present 
methods of culture, unless it took land just as necessary 


for other purposes and devoted it to wheat raising. 
We are left, practically, with a shortage of 400,000,000 
bushels in our wheat supply, even if we consume every 
grain we raise. This amount we should have to pro- 
cure from some other source. Where are we to get 
it, and how is it to be paid for ? 

Where in the world is there a surplus of 400,000,000 
bushels ? We ourselves furnished the great surplus 
in the past. Canada is now rapidly approaching us, 
and so is Argentina. But with the present rate of 
immigration into the Canadian Northwest, and with 
a rapid increase of population throughout the Domin- 
ion, it will not be long before they need 100,000,000 
bushels for their own use. They may be able to sell 
150,000,000 or even 200,000,000 bushels, and they 
are close to our markets, but all they could give would 
not furnish us the 400,000,000 bushels we must have. 
Manchuria will eventually produce much wheat, but 
its development will probably no more than supply, 
if it does not fall below, the increasing demand of 
China and Japan. Russia and Argentina and Aus- 
tralia together are scarcely keeping up with the world's 
present necessities. Wheat bread and high civiliza- 
tion go together; and as labour conditions everywhere 
improve, more and more people who once lived on 
black bread or rice will want the white loaf. A supply 
to meet the coming new demand is nowhere in sight. 

Because of these facts I have said many times in 
different articles and addresses for years past that wheat 
must advance; and that a price of over rather than 


under one dollar per bushel might be expected hereafter. 
Market quotations verify the prediction. Without any 
artificial support, cash wheat in New York reached 
$1.50 early in June, 1909. The latest statistics com- 
pletely confirm the view that the condition which the 
country faces is permanent. Lest the comparison 
already made, covering two years a quarter of a century 
apart, should not have selected representative years, 
take two five-year periods instead. This will give a 
fair measure of the average producing capacity of our 
wheat acreage and its insufficiency for growing demands. 
The average wheat crop of the United States during 
the five years 1880-84 was 463>973>3*7- For the five 
years 1904-08 it was 655,865,795 bushels. The increase 
is 41 per cent. But the population of the United 
States was 50,155,783 in 1880, and the official estimate 
for 1908 is 87,189,392, an increase of 74 per cent. 
Home demand has grown 80 per cent, faster than 

The same rapid transition appears in the records 
of our exports of breadstuffs. A wheat crop of 
700,000,000 bushels is unusual. Allowing six and 
a half bushels per capita for home consumption and 
seed, this leaves a surplus of 115,000,000 bushels as 
a practical maximum. Our average exports of wheat 
and wheat flour, reckoning four and one-half 
bushels to the barrel, were 149,572,716 bushels 
for the five years 1880-84, and 113,146,896 bushels 
for the years 1905-09. For the former period the 
average amount retained for home consumption 


was 30 1, 598,927 bushels; for the years 1904-1908 it was 
542,180,037. The decrease in exports for the quarter- 
century is 24 per cent., and the increase in the 
amount held for our own needs is 80 per cent. 
These figures coincide with and confirm one another. 
They lend probability to the suggestion that in 
another ten years the United States may have become 
a wheat importing nation. 

The price of wheat has responded, naturally and 
inevitably, to these price-making conditions. As long 
as we have a large surplus for export, the price will be 
determined by the figure at which this can be disposed 
of abroad; will be fixed in the markets of the world 
by the adjustment of the world's supply and demand. 
So prices in all the markets of this country in the past 
have varied with the cable quotations from Liverpool. 
But the moment our surplus disappears or becomes 
inconsiderable, our own requirements will have more 
influence upon prices, which will be made more and 
more in our own markets. We can see the change 
toward this, just as we can see the decline of exports 
and the increase in home consumption. In May, 
1909, wheat that had been shipped from Kansas City 
to Chicago and sold there was re-sold and shipped 
back to Kansas City at an advanced price. In the 
same month wheat was taken out of storage in New 
York City, shipped by steamer to Galveston and sent 
by rail to supply the immediate needs of mills in the 
wheat belt. 

When the speculative element in recent wheat prices 


is allowed for, there remains a considerable margin of 
permanent advance. The collapse of all artificial 
support leaves this unchanged. The same economic 
forces which have been at work for the last twenty-five 
years are still operative. They confirm the advice 
given to farmers during that time and throw new light 
upon markets and prices. The improvement of farm 
methods will henceforth feel both the goad of our 
growing necessities and the stimulus of prices kept 
permanently higher by conditions so inseparably con- 
nected with the future growth of the United States 
that no probable change in world conditions could 
alter them. 

With this strong light of fact upon the subject, if it 
be granted now that the additional 400,000,000 bushels 
of wheat which will be required to feed the country 
a little later on will be supplied from some now unde- 
termined source, wherewith shall the bill be paid ? It 
is not a rash statement that if we have to step into the 
markets of the world and buy 400,000,000 bushels, 
we should have to pay $1.50 per bushel and perhaps 
more. Where is the money to come from ? In the 
year ending June 30, 1908, we exported wheat and 
wheat flour to the value, in round numbers, of 
$164,000,000. That will be cut off. So we must 
find over $700,000,000 in all to pay our bread bill. 
That is one-third of the value of our entire exports in 
the year 1908. 

We cannot provide for this vast annual payment by 
increasing exports. Already the products of the soil, 


the minerals and oils taken from the earth, and such 
raw materials as leather and lumber, drawn immedi- 
ately from the earth's products, constitute two-thirds 
of all our exports. Our whole export of manufactured 
goods other than products of the farm amounted to 
$480,000,000 in 1907. For 1909, the value of our 
total exports classified as foodstuffs, either crude or 
partly or wholly manufactured, and food animals, 
amounted to $438,000,000. We imported of the 
same classifications nearly $329,000,000. The idea 
that we feed the world is being corrected; and unless 
we can increase the agricultural population and their 
product, the question of a source of food supply at 
home will soon supersede the question of a market 
abroad. For the most part we are only artificial 
competitors in the outside markets of the world, 
and would have to withdraw from the foreign field 
if we were obliged to depend solely upon our own 
industrial merits. Our factories could not keep open 
and pay the current scale of wages if they received for 
their total product the prices now charged the foreign 
purchaser. We shall never be able to make a much 
better showing than we do now in international com- 
merce. We shall be fortunate, rather, if we hold our 
own. The soil alone renews itself, endures patiently, 
and is capable of yielding increasing rewards to 
industry as agriculture conforms more closely to the 
principles that science and experience have estab- 
lished. The products of the earth and the popula- 
tion of the earth may increase together, if we are 


wise, so that the one will support the other. And 
this is the sole escape from the melancholy conclusion 
to which Malthus was forced long ago because, 
in his time, the possibilities of modern soil culture 
were not understood. 

But our need is more urgent than has yet been made 
apparent. I have said that improvement in agricul- 
ture could not afford to wait upon the slow work of 
the agricultural colleges and the rise of a new genera- 
tion. We must make haste. Let us look a little more 
in detail at the twenty-five years between 1882 and 1907 
and some impressive facts will appear. The net 
increase in wheat acreage in that time was 8,143,806 
acres and in production 129,901,530 bushels. This 
rise was wholly due to the opening of new Western 
lands, without which both acreage and production 
would have declined heavily. The wheat acreage of 
three rich, representative agricultural states in the 
older section of the country compares as follows: 


New York 

IN 1882 


IN 1907 


Ohio . . 


*f* * **]***+** 


On the other hand there were enormous additions 
of the new and fertile land in the West and Southwest. 
The following table of wheat acreage in more recently 
occupied territory shows how we have been able to 
add 130,000,000 bushels to our product, while old 


lands were being withdrawn from wheat growing and 
the yield per acre of the best lands was falling: 


IN l882 IN 1907 

Minnesota ...... 2,547,000 5,200,000 

North and South Dakota . . 720,000 8,413,000 

Montana ...... 42,812 139,000 

Washington . . . . . . 148,000 1,349,000 

Kansas ....... 1,573,000 5,959,000 

Nebraska ...... 1,657,000 2,535,000 

Oklahoma ...... 959,000 

Total 6,687,812 24,554,000 

It is clear that we cannot make up in the future for 
either decreasing acreage or declining productivity as 
we have in the past. And there will be a big gap to 
fill. The total wheat product of the three older states 
selected to illustrate our farm tendency New York, 
Ohio and Michigan was 87,914,200 bushels in 1882 
and 50,605,000 bushels in 1907. If we estimate the 
future falling ofF in our wheat supply from similar 
causes at half a bushel per acre per annum, and apply 
this to an acreage of 45,000,000 it gives an annual 
deficit of 22,500,000 bushels. But we are also adding 
to our population about 2,000,000 each year by immi- 
gration and natural increase, and these must be fed. 
At six and a half bushels per capita the low average 
already used they would consume 13,000,000 bushels. 
We must, therefore, provide from some source 
for an annual deficit of more than 35,000,000 bushels. 


The startling feature of this changed aspect of 
demand and supply is that it is immediate. We have 
to provide for a contingency not distant from us by 
nearly a generation, but already present. The food 
condition presses upon us now. The shortage has 
begun. Witness the great fall in wheat exports and 
the rise of prices. For the first nine months of the 
fiscal year, ending June 30, 1909, our export of wheat 
and flour combined was but 103,251,200 bushels. 
Such is the size of the national surplus in a fair crop 
year. It must shrink more than 100,000,000 bushels 
for each three years hereafter. Obviously it is time to 
quit speculating about what may occur even twenty 
or thirty years hence, and begin to take thought for 
the morrow. As far as our food supply is concerned, 
right now the lean years have begun. 

I have stated the national problem in terms of wheat 
for the sake of clearness; its solution admits of similar 
statement. The average wheat yield per acre in the 
United States in 1907 was 14 bushels. The average 
for the last ten years is 13.88. That is, in 1907 it 
required 45,211,000 acres to produce the 634,087,000 
bushels that we raised. It is a disgraceful record. 

About a century ago this was the average production 
per acre of Great Britain. After the appointment of 
a Royal Commission and a campaign for better methods 
of cultivation begun over a hundred years ago, the fields 
of the United Kingdom to-day, tilled for a thousand 
years, in a climate whose excessive moisture is unfav- 
ourable to the wheat grower, yield over 32 bushels of 


wheat per acre. Germany, an agricultural country 
almost from the time of Tacitus, produces 27.6 bushels 
per acre. Suppose that the United States produced 
28 bushels, or double its showing in 1907. That 
would be nothing extraordinary in view of what Euro- 
pean countries have done with inferior soils and less 
favourable climates. It would have added 634,000,000 
bushels to our product in 1908. 

Here we perceive an answer to the question that the 
future asks. Here we see how the 200,000,000 people 
of about the year 1950 are to be fed. Here we see 
where the money will come from for our national 
support. It must be earned by and paid to the farmers 
of this country. But this implies a kind of agriculture 
differing greatly from that which now prevails. 

The disease of bad farming, from which this country 
suffers, is a chronic complaint. The following is an 
extract from a letter written by Washington to Alex- 
ander Hamilton: 

"It must be obvious to every man, who considers 
the agriculture of this country (even in the most 
improved parts of it), and compares the produce of 
our lands with those of other countries, no way supe- 
rior to them in natural fertility, how miserably defective 
we are in the management of them; and that if we do 
not fall on a better mode of treating them, how ruin" 
ous it will prove to the landed interests. Ages will 
not produce a systematic change without public atten- 
tion and encouragement; but a few years more of 
increased sterility will drive the inhabitants of the 
Atlantic States westwardly for support; whereas if 


they were taught how to improve the old, instead of 
going in pursuit of new and productive soils, they 
would make those acres which now yield them scarcely 
anything turn out beneficial to themselves." 

Washington's foreboding has been justified. 
A recent bulletin of the Federal Department of 
Agriculture says: 

"Wheat was produced quite successfully in central 
New York for something like forty years. During 
the latter part of that period the yields began to decline, 
and at the end of another twenty years they were so 
low that exclusive wheat growing became unprofitable. 
Ohio, Indiana, Illinois and Iowa have each in turn 
repeated the history of New York. The soils of these 
states were productive in the beginning, and it required 
forty, fifty or sixty years for the single crop system to 
materially reduce the yields." 

Good farms in the Mohawk Valley in New York 
State forty years ago were worth from $100 to $150 
per acre; now many are sold at from $25 to $30. This 
is not because wheat has become cheap, for it is dear, 
not entirely because of Western competition, but 
because there is neither good cultivation nor enough 
cultivators. The younger generation throngs the 
cities; and the land, rented by its owners to tenants 
careless of everything but immediate profits, is 
abused and robbed of its fertility. In New York 
State 20,000 farms are for sale. The southern central 
portion shows a progressive loss of population. Pro- 
fessor Tarr, of Cornell University, in an article pub- 


lished during 1909, says: "I have driven much over 
the country roads of this section, and have been aston- 
ished at the evidence of general decline in the farming 
industry, especially in the hilly sections. Abandoned 
houses in all stages of decay abound, and in some 
cases the forest is encroaching on the pasture." Schuyler 
County had 3,815 less population in 1895 than in 1860, 
Tioga County 2,000 less and Yates 992 less. 

If anybody imagines that this process of exhaustion 
and abandonment or transfer to other uses is peculiar to 
the East, let him look at Iowa, whose average wheat crop 
in the five years 1883-87 was 29,682,560 bushels, and in 
the five years 1904-08 was 9,976,488 bushels. In 1908 it 
was 8,068,000. The following table of the wheat produc- 
tion of the forty counties of northern Illinois by decades 
tells the story more forcibly than words could express it: 

..... 10,476,011 

l880 ..... 7,122,963 

1890 ..... 5,073,070 

19 ..... 

Instead of preserving the fertility of their lands, our 
farmers have gone in search of new soils to be skinned, 
robbed and abandoned as soon as the old showed 
signs of exhaustion. Now that they have reached 
the jumping-ofF place, and there is no longer any 
"West" to move on to, what have they left behind? 

The average yield of wheat in New York State as re- 
cently as 1898 was 21.2 bushels per acre; in 1907 it 


was 17.3. But for considerable tracts in the state 
which have been carefully farmed from an early date, 
the general average would be much lower. In the 
same short time the average crop in Indiana has fallen 
from 15.6 bushels per acre to 14.4; in Minnesota from 
15.8 to 13; in North Dakota from 14.4 to 10; in 
Oklahoma from 14.9 to 9; and in the entire United 
States from 15.3 to 14. We cannot feed our future 
population with our present methods. We must im- 
prove; and years of scientific investigation and practical 
experience have demonstrated how it may be done. 

There is scarcely a limit, at least none has yet been 
reached by the most intensive cultivation, to the value 
which an acre of ground may be made to produce. 
Right methods of farming, without which no agricul- 
tural country such as this is can hope to remain pros- 
perous, or even to escape eventual poverty, are not 
complicated and are within reach of the most modest 
means. They include a study of soils and seeds, so 
as to adapt the one to the other; a diversification of 
industry, including the cultivation of different crops 
and the raising of live stock; a careful rotation of 
crops, so that the land will not be worn out by succes- 
sive years of single cropping; intelligent fertilizing, 
by this system of rotation, by cultivating leguminous 
plants and, above all, by the economy and use of every 
particle of fertilizing material from stock, barns 
and yards; a careful selection of grain used for seed; 
and, first of all perhaps in importance, the substitution 
of the small farm, thoroughly tilled, for the large farm, 


with its weeds, its neglected corners, its abused soil 
and its thin product. This will make room for the 
new population whose added product will help to 
restore our place as an exporter of foodstuffs. The 
fruit farmer, the truck farmer, every cultivator of the 
soil who has specialized his work, has learned the value 
of these simple principles. The problem is, how to 
impress it upon the thirty million or more persons 
who live on the land and till it. 

The modern agricultural method is both a money- 
maker and a labour-saver. The cost of rent and 
production for continuous wheat cropping averages 
$7.50 per acre. When, therefore, the farmer obtains, 
as so many in the Northwest do, a yield of eight or ten 
bushels per acre, it just about meets, at average farm 
prices, the cost of production; leaving him either noth- 
ing at all for his year's toil, or else a margin of debt. 

For the same amount of labour, covering the same 
time, but intelligently applied to a smaller area, he 
might easily produce by improved methods twenty 
bushels to the acre, leaving him a profit of over $12 
per acre. The not unreasonable yield of twenty- 
eight bushels would net him $20, which is 10 per 
cent, on a valuation of $200 per acre for his land. 

This gigantic waste, applying the same measure 
to the production of the entire country, is going on 
every year. If it can be stopped, the saving would 
pay for building a Panama canal every year; it would, 
in two years, more than pay the estimated expense of 
improving every available waterway in the United 


States; it would save more money for the farmer than 
the railroads could if they carried all his grain to market 
free of charge. Let us set these simple principles of 
the new method out again in order. 

First --The farmer must cultivate no more land 
than he can till thoroughly. With less labour he will 
get more results. Official statistics show that the net 
profit from one crop of twenty bushels of wheat to the 
acre is as great as that from two of sixteen, after original 
cost of production has been paid. 

Second - - There must be rotation of crops. Ten 
years of single cropping will pretty nearly wear out 
any but the richest soil. A proper three- or five-year 
rotation of crops actually enriches the land. 

Third - - There must be soil renovation by fertilizing; 
and the best fertilizer is that provided by nature her- 
self barnyard manure. 

Every farmer can and should keep some cattle, 
sheep and hogs on his place. It is not in the nature 
of things that a man on a wheat farm, working four 
or four and a half months a year, can make as good a 
living for himself and family, or that he will be as 
happy over it as if he worked a reasonable portion of 
the whole twelve months; as if he fed some cattle; 
as if all his time were employed. The farmer and his 
land cannot prosper until stock raising becomes an 
inseparable part of agriculture The natural increase 
of animals, the butter and milk, the stock sent to market 
- ail add materially to the income of the farm. Still 
more important is the fact that of all forage fed to 


live stock at least one-third in cash value remains on 
the land in the form of manure that soon restores 
worn-out soil to fertility and keeps good land from 
deteriorating. By this system the farm may be made 
and kept a source of perpetual wealth. 

Without difficulty, following approved agricultural 
methods, the wheat average of the United States can be 
raised from 13.88 bushels per acre for the ten-year period 
stated to the 28 bushels produced by the inferior soil of 
Germany, the 19.8 of France of the 32.2 of the United 
Kingdom, to say nothing of the immensely greater 
yields than this of all varieties of farm products in 
Belgium and the Netherlands, on the Island of Jersey, 
and wherever intensive farming has been followed. 
Reports from the experimental farms of the agricultural 
college in Montana show that crops are obtained by 
summer fallowing from two to four times as great as 
by continuous cropping The value of farm lands 
will rise in proportion to the increase of the values 
produced. The total value of farm property with 
improvements in the United States, given by the census 
of 1900, shows, when divided by the whole number of 
acres in farms, an average value of a little over $20 per 
acre; when divided by the number of improved acres 
only, the average value is a trifle over $40. It would 
be a simple matter to raise the market value of farm 
property the country over to $100 an acre by a system 
of careful, intelligent, diversified farming. 

Other peoples have been quicker to learn this than 
we. Denmark has an area of less than 16,000 square 


miles, a little less than one-fifth that of Minnesota, 
and a population in 1906 of 2,605,268. Only 80 per 
cent, of her area is productive, and her population is 
167 per square mile. Yet in 1906 she sent abroad 
Dver $80,000,000 worth of her home product of pro- 
visions and eggs. Great Britain bought from her 
that year butter to the amount of $48,000,000 and 
bacon worth over $21,000,000. It is interesting in 
this connection to note that, though her population is 
so dense, there were in 1905 but 754 men and 69 
women in her penitentiaries. 

The Netherlands has a still more closely compacted 
population of 5,672,237 on an area of 12,648 square 
miles, or 448 per square mile. The advantage of this 
is that it forces smaller holdings and a more thorough 
tillage. The average wheat yield in the Netherlands 
is 34.18 bushels as against our 14; she produces an 
average of 53.1 bushels of oats per acre, where we are 
satisfied with 23.7 bushels in 1907 and an average of 
less than 30 bushels for the preceding ten years; her 
farmers gather 232 bushels of potatoes from every 
acre so planted, while in this country, with soil capable 
of fabulous yields, we averaged 95.4 bushels in 1907 
and a trifle less than 96 bushels for a six-year period 
ending with 1907. The difference between 95 bushels 
and 230 bushels at 50 cents a bushel, is $67.50 per acre. 

The value of our annual farm product is now over 
eight billion dollars. It might easily be doubled. 
When the forests are all cut down and the mines are 
nothing but empty holes in the ground, the farm lands 


of the country will remain capable of renewing their 
bounty forever. But they must have proper treatment. 
To provide this, as a matter of self-interest and national 
safety, is the most imperative present duty of our 
people. Indolence, bad farming methods, greed and 
the idea that it needs no brains to run a farm have 
prevented agriculture from taking its true place in 
the national life and multiplying the value of both 
the soil and its product. They should not be proof 
longer against the progress of new ideas. The armed 
fleets of an enemy approaching our harbours would be 
no more alarming than the relentless advance of a 
day when we shall have neither sufficient food nor 
the means to purchase it for our population. The 
farmers of the nation must save it in the future, just as 
they built its greatness in the past. 

The man who assumes to be the farmer's friend or 
hold his interests dear will constitute himself a mis- 
sionary of the new dispensation. It is an act of patri- 
otic service to the country. It is a contribution to 
the welfare of all humanity. It will strengthen the 
pillars of a government that must otherwise be endan- 
gered by some popular upheaval when the land can 
no longer sustain the population that its bosom bears. 
Here lies the true secret of our anxious interest in agri- 
cultural methods; because, in the long run, they mean 
life or death to future millions; who are no strangers 
or invaders, but our own children's children, and who 
will pass judgment upon us according to what we have 
made of the world in which their lot is to be cast. 


THE development of any people is affected 
profoundly by the character, resources and 
disposition of its neighbours. England's 
insularity struck the note of all her great policies, 
at home and abroad, for centuries. Both France and 
Germany have histories vastly different from what 
they would have been but for propinquity working 
upon jealousy, rivalry and ill-will. The United States 
has had from the beginning only two neighbours to 
consider. Since the episode of Maximilian, our interest 
in Mexico has been scarcely more than a friendly 
observation of growth along lines so different, in the 
main, from our own that the question of conflicting 
interests could scarcely arise. On the north has 
arisen a Confederation so closely akin to us in all 
respects, so remarkable in recent expansion and 
promise, so well worth taking note of either as a helper 
or a competitor in American continental development, 
that the question of our trade relations with the 
Dominion of Canada is one of the most practical 
issues of the day. 

These relations were, in the first period, slight and 
unfriendly, owing to hostile feelings carried over from 



our wars with Great Britain, and to disputes over 
rights in sea fisheries, almost the only point where 
the two interests touched; in the second period there 
was a gradual drawing together, due to such uniformity 
of development, politically and materially, that it was 
easily expressed in the adoption of trade reciprocity; 
in the third period there was a growing indifference 
on our part, in response to Canada's desire for a 
practical zollverein, our attitude being determined 
partly by a totally inadequate comprehension of the 
resources and future of the Dominion and partly by the 
tightening bonds of a protective system determined 
upon universal sway; the fourth period, which includes 
the present, is marked by great progress in our neigh- 
bour of the north. What, in the light of business fact 
and of economic law, should be our trade policy as 
far as Canada is concerned ? For geographical position 
makes of that a separate and independent question; 
and by our answer to it will the fortunes of a continent 
be in no slight degree determined. 

The interests of these two peoples are as similar 
as the territories which they occupy. Place a pair of 
dividers with one leg on Chicago and the other at 
Key West, swing the latter to the northwest, and it 
will not reach the limit of good agricultural land. 
Nature knows no artifical boundaries. "Classing the 
United States and Canada together," says Mr. Edward 
Atkinson, "occupying nearly the whole continent, 
it may be observed that the English-speaking people 
of this vast domain will constitute the only great nation 


producing a large excess of every kind of food that is 
essential for the support of life. " Here are to be found 
also the largest known deposits of nearly all the useful 
metals, much precious ore, the greatest existing body 
of valuable and accessible timber and other natural re- 
sources. No parallel of latitude marks where one form f 
of wealth ends. The great central plain of North Amer- 
ica is a physical unit. The characteristic and imposing 
feature of the interior of this continent is its material 
integrity. The two countries have identical languages, 
customs, usages of trade and agencies for develop- 
ment. In all that relates to their progress there is 
a natural oneness and necessary harmony as obvious as 
the unbroken extent of land that stretches north to 
the limit of settlement. 

As they began history together, the settlement at 
Quebec and that at Jamestown being separated by 
but a single year, so have the struggles of their child- 
hood been mellowed into respect and regard by years 
and adult understanding. And never, save after the 
rending of an empire by civil dissension, were there 
two peoples with distinct and hostile commercial 
systems yet possessing experience so similar in all that 
enters into nationhood. In each have been gathered 
human materials from every race and country, and out 
of the furnace where the fierce currents of free institu- 
tions run to and fro there arises a homogeneous race. 
Probably 50 per cent, of the population lately pouring 
into Western Canada, and the bulk of capital newly 
invested there, have come from the United States. 


On this side of the line reside 1,200,000 persons born 
in Canada. Each people is eager for an opportunity 
to enter the markets of the other. Despite tariff walls 
erected by both, traffic between them increases con- 
tinually. Ontario gets her coal from Pennsylvania, 
and New England would naturally get hers, if not 
prohibited by the tariff, from Nova Scotia. Geography, 
. ethnology, commercial interest and all the great, 
( silent forces are drawing us closer all the time. 

What has this sturdy young neighbour of the north to 
put into a partnership ? Her area is over 3,700,000 square 
miles, about the same as our own. She has more 
than twice the population of the American Colonies at 
the time of the Revolution. But all instrumentalities 
of progress are now so great that her development is 
like that of the United States in the twenty-five years 
following the close of the Civil War. Her population has 
doubled in the forty years since confederation. That 
of the Northwest Provinces has doubled in the last five 
years. Her timbered area is four times greater than that 
of the United States. In 1846 she had but sixteen miles 
of railroad; in 1908 she had 22,966 miles. The capital- 
ization of these lines runs above a billion and a 
half of dollars. Upon her splendid canal system she has 
spent upward of $100,000,000. Her local water 
transportation extends unbroken from the Straits of 
Belle Isle to Port Arthur and Fort William on Lake 
Superior, more than 2,200 miles. She may soon 
construct a ship canal from Georgian Bay, by way of 
Lake Nipissing, with continuous deep-channel naviga- 


tion to Montreal, which will reduce the distance 300 
miles. It will make Fort William 800 miles nearer 
Liverpool than New York is. By this route it will 
cost little more to deliver grain at Montreal or Quebec 
than it now costs to Buffalo. The total water-borne 
traffic of the Dominion for 1907 was 20,543,639 tons. 
Her mercantile marine, nearly equal to that of Japan, 
is the fourth largest in the world. 

Statistics of commerce bear similar witness to pro- 
gress. Our trade with Canada is exceeded in volume 
only by that with Germany and Great Britain. In 
1907 the aggregate imports and exports of the United 
States in trade with the Dominion were, in round 
numbers, $260,000,000. We think it worth while to 
negotiate reciprocity treaties which the Senate quietly 
pigeonholes with France; but our business with 
France in the fiscal year 1909 fell short of that with 
Canada by more than $25,000,000. We are spending 
some four or five hundred million dollars possibly 
on the Panama Canal, one object of which is to 
increase trade with the west coast of South America. 
Our trade with all the countries on both coasts 
of South America in 1908 was only a little over 
$200,000,000. With all Asia we did, in 1907, but 
$50,000,000 more than with Canada. The increase 
of Canada's foreign trade is interesting to this country 
in more than one relation. First, as has been shown, 
it makes her one of our best customers. Second, it 
is a measure of national growth that reminds us of our 
own earlier experiences. The total imports into the 


Dominion in 1897 were valued at $111,294,021 and in 
1907 at $345,271,690. Her total exports in the former 
year were $134,003,123, and in the latter, $226,512,063. 
This is a growth of 133 per cent, in the ten years. 
Her total foreign trade in 1909 was over $640,000,000. 
It is most interesting, in the third place, to note how 
calmly but irresistibly natural laws and the advantage 
of favourable markets sweep away the barriers which the 
petty policies of legislators erect. In spite of hostile 
tariffs in both countries, directed especially against 
each other; in spite of the large market offered by 
Great Britain for the raw products of Canada; in 
spite of political connection and the offer of pre- 
ferential advantages to British goods in Canadian 
markets, Americo-Canadian commercial intercourse 
has prospered and grows at the expense of other 

From 1898 to 1906 Canadian imports from Great 
Britain increased from $32,043,461 to $69,183,915, 
or over $37,000,000. During the same time her imports 
from the United States increased from $74,824,923 to 
$168,798,376, or $93,973,453, according to her official 
statistics. In these years the exports of Canadian 
products to the United States increased over $49,000,000 
and those to England less than $34,400,000. In 1895 
her dutiable imports from the United States exceeded 
in value those from the United Kingdom by $2,500,000; 
in 1909 the difference in our favour was nearly 
$43,500,000. Her imports of articles on the free list 
from the United States were nearly $74,500,000 greater 


than those from the United Kingdom. The value of 
goods reaching Canada in bond from United States 
ports in 1906 amounted to $25,936,120, while the 
merchandise received in transit from Canada in 1908 at 
the Atlantic seaports of the United States and thence 
shipped to foreign countries was valued at $25,300,790. 
These figures are striking. Each country has built up its 
foreign trade by heroic efforts and continued national 
encouragement. In each there has been provided an 
ample system of internal transportation, and each 
has ocean ports possessing every required advantage 
for the receipt and shipment of commodities entering 
into international commerce. Yet, to an extent aggre- 
gating an appreciable portion of their entire foreign 
trade, each finds it convenient to use the ports, the 
railroad systems and the canals of the other. There 
can scarcely be a more forcible commentary upon 
the policy of mutual exclusion. 

The development of our neighbour in other respects 
has kept pace with the increase of her population, her 
transportation facilities, her agricultural wealth and 
her trading interest. The capital of her chartered 
banks is nearly $100,000,000 and their combined assets 
but little short of a billion dollars. The value of her 
field crops in 1908 was $432,534,000, and of her 
mineral products more than $87,000,000. Stimu- 
lated by both tariffs and bounties, the output of her 
factories in 1901 was valued at $481,000,000. By 
1906 its estimated value was over $700,000,000. 
Figures such as these give to the Dominion her just 


confidence in the future. She will not go to any part- 
ner empty-handed. 

That commerce must eventually move unrestrained 
between these two peoples is self-evident. Trade will 
go her own way, even though she must walk in leg-irons. 
Why not strike them off now and let her move freely, 
instead of paying the penalties of delay ? There is 
not one valid argument in favour of the system that 
makes our international boundary bristle with custom 
houses, and forces every dollar of trade between them 
to show its passport and pay its entrance fee. There 
is not one sound objection, on the side of either Canada 
or the United States, to unrestricted intercourse. 
Whatever men may think of the policy of protection 
as a general principle, it has no meaning and no excuse 
for being as applied by either of these countries against 
the other. The assumption of some fixed variation 
in the wage level is nonsense. Men are free to come 
and go; and New England depends at this moment 
for her labour largely upon her French Canadian 
population. Wages do vary, just as they vary between 
New York and Colorado; but their average under 
similar conditions is the same in the two countries. 

The true commercial relation between Canada and the 
United States is indicated by every fact in their commer- 
cial history. It is suggested by that common intellectual 
inheritance which has made the most scholarly mind 
in Canada, Goldwin Smith, as much at home perhaps 
in New York as in Toronto; and impelled one of the 
really great historians of our own country, Francis 


Parkman, to devote his life and genius to the story ot 
the founding of Canada. It is taught by their parallel 
development, and by the mingling of their commerce. 
The most natural, the most rational, the most highly 
profitable commercial relation between two peoples 
so situated and so dowered is absolute freedom of 
trade. The first step toward that must be the establish- 
ment of a trade reciprocity in natural products as 
generous as public opinion will approve. 

If either reciprocity or free trade could injure any 
interest, it must be the manufacturers or the farmers 
of one country or the other. But not only the logic of 
the situation but the plain facts of the case prove that 
no one of these four parties could suffer harm; that all, 
on the contrary, would benefit by the removal of restric- 
tions that each is at times forced to evade or nullify 
in its own interest. The manufacturer of Canada, 
standing behind his bounty and his tariff, has no need 
to fear the powerful combinations in the United States 
that require similar entrenchments. Not one of these 
great concerns controls production in its own country. 
Right here the small manufacturer competes success- 
fully with his greater rival. Anywhere on American 
soil the cost of carrying the manufactured article to 
market is sufficient handicap upon the distant as com- 
pared with the home producer. Indeed, the policy 
now followed by many large American concerns, of 
throwing their surplus upon the outside market at 
prices scarcely above the cost of production, a policy 
that could not be applied to Canada if the two countries 


were one uniform trade field, is now a greater disadvan- 
tage to Canada than her tariff can remedy. Any 
similar fear on the part of our manufacturing interest 
is fictitious and assumed. The grown man does not 
fear the infant's blow. 

A few years ago there was not a smelter on Canadian 
soil west of the Rocky Mountains. To-day there are 
eight in British Columbia, and these are largely occupied 
with the reduction of American ores. Our manufac- 
turers have as much reason to dread Canadian com- 
petition as Pennsylvania has to cry for protection 
against North Dakota. Canadian manufacturers 
would be no more endangered than is Montana by the 
competition of Ohio. Iowa, first of the states of the 
Union in the value of agricultural products, has risen 
to seventeenth place in manufacture, with a gross 
product of over $164,000,000 in 1900, without a tariff 
against New England. It is clear enough to people 
mentally honest with themselves that if there were no 
duty on any natural product of either country when 
entering the other, not a wheel would stop, not a man be 
thrown out of employment in either. But the business 
of each would feel the stimulus of enlarged markets. 
It is as certain a case of reciprocal advantage as can be 
found in the whole history of trade; which rests upon 
the axiom, sometimes forgotten or purposely ignored, 
that both parries to an exchange of commodities may 
be gainers by the transaction. 

The agricultural interest in both countries would 
benefit by freedom of markets. Our cities afford a 


market for everything that the Canadian farmer can 
furnish. His breadstuffs, cattle and meat supplies, but- 
ter, cheese, eggs and wool would reach new consumers. 
In 1906 Canada exported to the United States 3,831,988 
bushels of wheat, valued at $2,981,608 according to 
her official statistics. This is an average price of 77 
cents per bushel. In the same year the United States 
exported 34,973,291 bushels of wheat, valued at 
$28,757,517, or an average price of 82 cents per bushel, 
according to her official statistics. The average price 
of No. 2 red winter wheat that year in the New York 
market was 86j cents per bushel. This difference is 
not always the same, nor does it exist at all times; but 
it is true that the price on the American side is usually 
from three to five cents greater than on the Canadian. 
Would this prospective gain to the Canadian farmer 
involve a corresponding loss to the farmer of the United 
States ? Not at all. The time has now arrived when 
the home demand for many of the products of the soil 
is greater than he can supply. Again, taking wheat as 
an illustration, so great is our need of the grain of 
Canada that we have been obliged to cut a sluiceway 
through tariff restrictions and invent a milling-in-bond 
system, by which wheat may come over the line, be 
converted into flour and then exported free of duty. 
Opposition to that arrangement or any attempt to 
destroy it is an appeal to ignorance. The existing 
custom is in the interest of the farmers of both countries, 
just as a still larger measure of liberty would be. It 
is the surplus of each country's grain, which must be 


marketed elsewhere, that fixes the price. The same 
cable that announces a price change to New York 
carries it to Minneapolis and to Winnipeg, and these 
markets vary in harmony with the relation of each to 
the world distribution of grain. As a matter of fact, 
every bushel of wheat that is converted into flour aids 
to maintain wheat prices by reducing the "visible 
supply"; that world accumulation of stocks according 
to whose volume prices steadily rise or fall. It has been 
shown in a preceding chapter that our annual consump- 
tion of wheat in the near future will be 1,300,000,000 
bushels. Whatever part of the deficit thus created 
Northwestern Canada can supply should be free to 
flow untaxed to the consumer. 

Has Canada anything to fear from the most liberal 
reciprocity ? Her former growth under such a policy, 
the ability of her manufacturers and their large supplies 
of raw material, the magnitude of the market expansion 
assured by an addition of over eighty-seven million 
customers, all declare that the period of such trade 
emancipation would be the most splendid in her 
remarkable history. Has the United States anything 
to fear from competition on the north ? Few men in 
this country are better qualified to answer this question 
than Mr. D. M. Parry, formerly President of the 
American Manufacturers' Association. Mr. Parry says: 
"The Canadian trade is more important than all the 
commerce anticipated for the Panama Canal, and yet 
our tariff policy in respect to Canada could hardly be 
worse had it been dictated by a foreign enemy. . . . 


As for the tariff on raw materials, why should this 
country be so anxious to exhaust its mineral wealth 
and denude its forests that it should bar these 
products from other countries ?" A big lumber 
manufacturer of Saginaw, Michigan, representative 
of an industry once most hostile to reciprocity, writes 
these words in the Annals of the American Academy 
for the Advancement of Political and Social Science: 
"As a manufacturer, as an employer of labour, and as 
one who has been in the lumber business all his life, 
and is now engaged in it, as an owner of forests and 
timber lands and sawmills, I cannot see wherein the 
government of the United States is not making a great 
mistake in maintaining this tariff upon rough lumber, 
taxing our home industries for their raw material and 
offering a premium for the destruction of our present 
forest area." 

After all, the most conclusive argument for recip- 
rocity with Canada always has been and must be the 
experience of our own states. Had it not been pro- 
hibited by the federal constitution, each state of the 
Union would speedily have levied a duty on all com- 
merce crossing its boundaries. Even with the enlight- 
enment of our own past about us, it is probable that, 
if this prohibition were removed, not many years 
would pass without some such restrictive legislation 
by certain of the states. Yet all acknowledge at this 
moment that one great factor in the development of 
the United States has been the commercial elimination 
of state lines. Unrestricted trade between the states 


has aided all of them. The force of this argument 
as applied to distant nations is broken by differences of 
race, custom, standards of living, wages and other 
elements in cost of production. But it applies with 
full force to this contiguous territory north of us, 
so nearly allied to us in natural conditions, in institutions 
and in every condition by which material growth is 
determined. Canada is merely a portion of our own 
Western country, cut off from us by the accidents of 
original occupation and subsequent diplomatic agree- 
ment. The proof that it would benefit both her and 
us to draw closer the commercial tie is written in the 
history of the soil on which we live. 

In this country the policy of reciprocity with Canada 
has won its way to favour over all opposition. New 
England wants it, the tier of important states facing the 
Canadian boundary and the Great Lakes favours it, 
the Middle West believes in and asks for it. It has 
been too long considered only as a boon for us to grant 
and Canada to ask. If that was true thirty years ago, 
it is not true to-day. Canada no longer comes as a 
suppliant and can never again be so dealt with. Her 
interest is no greater and no less than ours, her position 
as independent. Every turn of the tariff screw by the 
United States merely exasperates Canada, and hardens 
her determination to achieve industrial independence 
even if it should have to be purchased at the cost of 
industrial isolation. Both peoples should put away 
selfish greed and selfish fear, and join in the creation 
of a great zone wherein trade as well as men may be 


free. From this country, as the older, larger and more 
developed community, and the one whose past attitude 
has been marked by greater indifference, the invitation 
should come now for the adoption of a system of reci- 
procity that means not only international friendliness, 
solidarity and mutual support, but also large trade ex- 
pansion and financial gain for both parties concerned. 
The tide of time sweeps all nations into a closer 
concordance, willing or unwilling, of governmental 
policies. The world grows smaller in the separateness 
of its people and greater in its possibilities of united 
action every day. Moving in the sunlight of such an 
era, the two peoples whom ties of blood and capacity 
for self-government and material achievement have 
knit so closely should oppose a nobler manhood and a 
larger statesmanship to the policy of estrangement and 
jealousy that has been permitted to guide their fortunes 
in the past. The beginning of all reform or progress 
in public policies under a republic is the creation of an 
intelligent public opinion. Already our own people 
are ready, many of them eager to be convinced. There 
is most need of strong and intelligent leadership, to 
force and keep before the public as a living issue this 
question of more generous trade relations with Canada, 
and all that such a measure would mean to us. It 
would enhance the greatness and the wealth of the 
United States by the addition, in all but the political 
relation, to our working body of a population of some 
seven million people, as industrious, moral and sturdily 
bent upon progress as any in the world. It would mix 


to the finest temper and unite in due proportion those 
elements of world traffic whose fusing and blending 
are going on before the eyes of this generation. It 
would read a new moral into the lessons of history by 
proving the ability of the English-speaking races to 
combine in essentials, however they might differ in 
details, for the work in the world that has been allotted 
to them as their share and the price of their leadership. 
Nor could it fail to foster, in slower and more permanent 
ways, the growth of that sentiment of human kinship, 
moving toward a unity of human effort and aim 
and sympathy, which seems to be among the ultimate 
purposes and last events of the life of man upon this 



COMMERCE is the exchange of commodities, 
and the term is generally understood to 
include the buying and selling between 
individuals and, in a wider sense, between communities 
and nations. Under its adventurous leadership civil- 
ization and Christianity have spread to the remotest 
parts of the world. The commercial nations have, at 
all times exercised the strongest influence for good 
among the peoples of the earth. 

The development of commerce is the effort by a 
country to find a market for its own productions or 
to supply its own necessities or to increase further its 
means of commercial expansion. The commercial 
expansion of a nation is the index of its growth. This 
commercial growth may be either domestic or foreign, 
or both. 

There are three books which, if accurately written, 
would be found to follow parallel lines, dealing with 
the same material and proceeding from the same 
starting place to the same goal; these are the History 
of Commerce, the History of Transportation and the 
History of Civilization. So intimately related to every 
step of man's progress is this interchange of com- 


modities, drawing along with it the interchange of 
ideas and the selection of those best fitted to advance 
the world! 

Commerce, as an agent in modern life, has been 
sometimes unduly exalted and sometimes unfairly 
abused. It is neither the sole purpose of national life 
nor is it in any way necessarily connected with public 
or private impropriety. The word "commercialism" 
may cover the noblest as well as the basest things. 
But from the beginning of human intercourse, the 
barter of the savage which taught him that there were 
people, ideas, interests, capacities separate from his 
own, and thus applied a rude intellectual stimulus, 
down to the present time when international traffic 
has made of the whole world one huge place of exchange, 
commerce has been the softener of differences, the 
teacher of the undeveloped man, the emissary of new 
customs, new standards, better ways and larger thoughts 
- the effectual servant of the common human life. 

An occupation so ancient and universal, so knit 
to other industry wherever man has emerged from 
barbarism, and so growing with his growth, scarcely 
requires distinct treatment in a survey of any national 
development. It becomes rather a general measure 
of progress; and in one form or another the discussion 
of it enters into every chapter of a nation's history. 

More and more, with the increase in number and 
efficiency of methods of communication, commerce 
has become a world affair. Until a comparatively 
short time ago it was specialized and limited. The 


China trade, the India trade, the Guinea trade, the 
trade of Venice and Spain and Portugal and Holland 
down to the end of the eighteenth century were distinct 
and independent commercial ventures, more or less 
perfectly controlled and jealously guarded. Now, 
with only such limitations as tariffs impose and such 
regulations as hamper the carrying trade, the people 
of any part of the globe may and do trade with the 
people of any other part with no feeling of strangeness. 
The earth is becoming, commercially, one big exchange; 
in which, however, the principal traders are still those 
nations which race instinct or the habit of centuries 
has accustomed to the carrying on of commercial 
interchanges. Preconceived notions on this point have 
to be laid aside. 

First, the genius for commerce does not depend upon 
what we call civilization. It may be developed by the 
crowding of population, the necessity of finding new 
occupations, the need of realizing in some way upon 
a country's surplus product, whatever that may be. In 
some cases the instinct for trade appears to be an 
inheritance. It has been the property of the peoples 
of the Far East, in many respects so unlike us moderns, 
for centuries. And one of the most interesting features 
of their awakening is the fact that this quality of theirs 
grows more rapidly and vigorously than almost any 
other in the new atmosphere. The way in which the 
nations of the Orient are pushing their commercial 
affairs is worthy of our attention and emulation. We 
may call them uncivilized, but they are not. We may 


think that we shall build up a great trade with them, 
but we must remember that they are as quick at trading 
as we. The "Yankee" as a dealer may meet more 
than his match at Yokohama or Hongkong. 

Second, the mere existence of a market shows an 
opportunity; nothing more. It may not be an oppor- 
tunity for us, or we may not have the intelligence or 
the energy or the facilities required to take full advan- 
tage of it. Japan cannot feed her own people. They 
would buy very largely from us if we could only sell to 
them. China spends vast sums for iron and steel, yet 
w T e furnish only a small quantity of it, while the big per- 
centage goes to England and Germany. These people, 
with a low cost of living and a low wage scale, cannot 
pay our prices. Every step in their growth, numbering 
as they do from four hundred millions to half a billion, 
reaching out daily for means to develop their resources 
- for all the thousand aids that other countries further 
advanced in industrial methods can supply marks a 
big commercial possibility. Yet our trade with the 
Orient is almost moribund. We cannot create a great 
commerce with any people who cannot sell advan- 
tageously in our market as well as buy. We cannot 
trade largely with a country if we cannot compete 
with others in its markets. 

Third, the expansion of our foreign market is not 
in proportion to our internal growth and resources. 
Because the total of our foreign trade increases annually, 
we are encouraged to boast of it. It grows mostly 
because it has to; because it would be a miracle if it did 


not, when population and every form of domestic 
industry show an increase so great. But glance at 
some comparative figures. 

The combined imports and exports of this country 
in 1906 were $2,970,426,946; in 1907, $3,31 5,272,503; 
in 1908, $3,055,115,138; and in 1909, $2,974,931,328. 
Thus our entire foreign trade increased $344,845,557 
in 1907 over 1906. Between 1907 and 1908 it decreased 
$260,157,365. The net increase for the three years is 
$4,500,000. Our exports alone increased between 

1906 and 1907 by $136,986,578, and decreased between 

1907 and 1909 by $21 7,839,974. What was happening 
meantime to our real wealth, the backbone of our 
commerce ? The value of farm products increased 
$360,000,000 between i9O7and 1908, and $1,023,000,000 
in the two years between 1906 and 1908. 

Comparisons with other nations in fields where we 
should have an advantage over them are equally 
significant. Except Canada, whose business is bound 
up with ours by ties of nature and by great railroad 
and water systems, there is no country whose trade 
we should control so certainly as Mexico. It is at 
our doors, it is a republic, its relations with us are 
friendly and large amounts of American capital have 
been invested there. Mexico is growing rapidly. Who 
gets the benefit ? The large gains in the foreign trade 
of that country for 1907 as compared with 1906 were 
apportioned as follows: Germany, $1,872,739; Great 
Britain, $1,698,867; France, $728,307; United States, 
$415,806. Our total trade with Mexico fell off by 


more than $21,000,000 in 1908 as compared with 1907. 
In 1909 it decreased by nearly $5,000,000 more. 

Take another country where we should have a 
distinct advantage. Argentina is a big field, expanding 
yearly, and we need no Panama Canal to reach her. 
Her trade might be mostly with our country. Here is a 
record of the increase or decrease of her foreign com- 
merce, distributed by countries, for the first six months 
of 1907 as compared with the same period in 1906: 


Germany .... + $3,275,325 + 

Belgium . + 1,968,993 +4,132,071 

France 4Q7>559 4 3>5 6 > 8 7 6 

United Kingdom . . + 8,567,677 615,457 

United States . . . 966,129 -1,283,434 

The increase in importations into Argentina for the 
first quarter of 1908, as compared with the same period 
in 1907, was distributed as follows: United States, 
$186,690; United Kingdom, $5,873,021; Germany, 
$3,393,224; Italy, $2,747,934; France, $1,147,242. 
Such statistics tell their own story, and they might be 
continued indefinitely. 

Fourth, it is the nations north of the equator who are 
gifted with a genius for commerce and the resources 
that diversify and enrich it. Less than six per cent, 
of the population of the globe lies south of the equator, 
and this includes a large proportion of non-commercial 
races. North of that line the great commercial develop- 
ment of the last two centuries has taken place. It has 
been hastened by competition and the march of useful 


invention. It has been retarded by the long war of 
edicts against trade, hostile tariffs, reprisals, and all 
that human ingenuity enlisted in the aid of selfishness 
could do to repress its growth or divert it into channels 
other than those indicated by nature. None of the 
great physical laws which have helped upward the 
races that came to know and work with them can take 
precedence of the laws that govern commerce, and 
work themselves out to ends universally beneficent in 
spite of the little attempts of men and nations to turn 
them from their course or to alter their purpose; which 
is the amalgamating of human societies and the diffusion 
of all the good things earth has to offer among all 
earth's children. 

The question of commerce is, fundamentally, a 
question of markets. The main commercial needs of 
every people advanced beyond the primitive stage are 
two; an adequate market in which their products may 
be sold at a fair price, and an opportunity to purchase 
on reasonable terms those things which they cannot 
supply for themselves. Domestic commerce in this 
country is incomparably more important than foreign. 
We have no accurate measure of its volume, but it 
exceeds all our transactions in the outside field put 
together many fold. The foreign market assumes 
prominence in the public mind because it is there that 
our surplus must be disposed of. How small our 
business with South America is has already been shown 
by one example. We do from ten to eleven per cent, 
of that trade. With Canada we do better; and, were 


there reasonable liberty for commerce to develop, 
free from the restraint of obstructive tariffs, this might 
eventually become our best customer. In the Orient, 
as elsewhere shown, we might find buyers for our 
surplus cotton and food staples, as long as we have 
any surplus to dispose of, and our steel manu- 
factures, at least until its own resources are developed. 
But restraints upon trade, not created by corporations 
but forged by legislative action, have almost forced the 
discontinuance of successful and promising efforts to 
find an outlet there. With the increase of our popu- 
lation, this problem of markets is one of those that the 
future will have to solve. 

A market without means of communication between 
buyer and seller is like a meal placed out of reach of the 
hungry man. In our big market, which will always 
be the United States itself, the railroads are the factors 
that determine success or failure. In the chapters on 
"The Railroad," their function will be examined 
more in detail; and in that on "Waterways" is discussed 
the aid that may naturally be expected from our navi- 
gable streams in the conduct of domestic trade. It is 
remarkable, however, in any survey of natural con- 
ditions, to find that most public activity has been 
devoted to checking and embarrassing the interest 
without which the bulk of our internal and substantially 
all our foreign trade would perish in a fortnight. 
We are, indeed, pledged to spend a sum, which no one 
any longer dares to estimate even within a margin of 
a hundred millions, on the construction of the Panama 


Canal. It will, no doubt, have its uses, especially for 
the southern portion of this country. But it does not 
lie in the highway of our foreign commerce, and it 
opens to us no markets save those which we have 
already failed to improve. 

A real care for foreign trade requires the larger view. 
The world is bound together so closely by the ties of 
commerce that nothing can be high or scarce for 
any length of time if there is a supply anywhere on 
the face of the earth. Ships or rails will find it and 
bring it to market. We used to think of the travels 
of Mungo Park as something remarkable; but not now. 
Darkest Africa is almost a matter of daily information. 
And with this fusing of the world by commerce into 
virtually one community, the race will be to the intelli- 
gent, the enterprising, to those who can supply the 
best articles in the shortest time at the lowest prices. 
That is the final word of the modern commercial 

What do we need to achieve the success that ought 
to come to a people like ours, furnished with resources 
such as no others possess ? As far as commerce with 
other countries is concerned, we have to realize that 
we can no more fight the battles of trade with the 
policies of a century ago than we could carry a war 
through successfully if our soldiers were armed with 
blunderbusses, which they had to load from powder 
horn and bullet pouch. The modern system of maxi- 
mum and minimum tariffs has decided that no one 
country can profit long at the expense of discrimination 


against others. The United States has been behind 
a stone wall. It was a pretty good defence against 
arrows, but it will not withstand the artillery of the 
commercial systems of to-day; and it is worth nothing 
when you have to sally out from behind it and meet 
your competitors in the open field. We make low 
freight rates on commodities for export to our seaports, 
and there meet regulations that prevent us from 
competing. We build up some trade on the basis of 
overcharging the home consumer to pay for selling 
cheap to the foreign customer; and no such system 
can be permanent. We place an embargo on enter- 
prise. We can enjoy the home market as a monopoly, 
and make what there is in it, or we can go out and take 
our place in the markets of the world and join in the 
world struggle for that business. But we cannot 
do both at the same time; and the sooner this is realized, 
the better it will be for the country. 

We need for our trade and for every agency con- 
nected with it a larger measure of the freedom that 
our government guarantees to the individual as a 
citizen. We need encouragement for those who are 
seeking and making new markets in the remote 
places of the earth; and such necessary and proper 
assistance for our merchant marine, for the agencies 
actually engaged in commerce, the transporters of 
products, and not swift passenger and mail lines, 
as will put us on an equality in the carrying trade with 
the other commercial nations. Before we can compete 
with them at all, of course there must be an abolition 


of the rule requiring publication of foreign rates 
before they can be changed; a condition now imposed 
by law, which enables any tramp steamship to underbid 
any American carrier in any port of the world. It 
is equivalent to the forced transfer by law of the 
business of American ships to those under any flag 
which see fit to cut a rate in order to get business away 
from their competitors. 

Most crying of all, perhaps, is the need for more 
information among our politicians. They propose 
and carry through restrictions upon commerce like that 
just referred to, of whose effect some are profoundly 
ignorant, while some are actuated by demagogy and 
malice. Men who are mere demagogues, and other 
men who mean well but do not know, have never 
made a study of commerce, join hands to put into 
effect legislation that is mischievous in principle and 
can be only injurious in operation. Objection, criti- 
cism, even pleas for delay until there may be full 
consideration, advanced by experienced men, are 
ascribed to unworthy motives. Many men of high 
ability and unblemished character in the United 
States Senate have been attacked and have actually fal- 
len into some popular disrepute because they opposed 
ill-considered legislation which the study and experi- 
ence of a lifetime had told them could work out only 
in misfortune to commercial interests and all the 
people dependent upon them. A recent critic of our 
institutions has said that the provisions of our Constitu- 
tion and the difficulty of changing them render our 


Government less responsive to changing ideas than those 
of more conservative peoples, living under systems 
far less liberal in their beginning and history. The 
remark would be more applicable to our commercial 
system, and the archaic or meddlesome legislation 
that underlies much of it. The people of the American 
Colonies had no greater need of a Declaration of Inde- 
pendence than the people of the United States have 
of an act of emancipation which shall free commerce 
from the fetters, old and new, that now impede every 
movement toward her rightful and possible triumph. 

A free, prosperous and intelligent people, with a 
high standard of living and the still higher standard of 
efficiency that should exist in such an environment, 
and that must be established and maintained if we 
are to do anything worth while in the world, will create 
the greatest and most profitable commerce, will 
occupy to most advantage both the home and the 
foreign fields when troubled by fewest conditions 
and regulations. Because commerce has to do with 
commodities gathered or manufactured by the hand of 
man, and is carried on with means of communication 
created or improved by men, governments and individ- 
uals find it difficult to understand that it is, nevertheless, 
subject to inherent natural laws just as irresistible 
and as proof against man's efforts to alter them as 
any of the great natural processes observed in the rise 
of human society. Cheap little victories won by 
artificial devices, transient and accidental advantage, 
all are worthless. A survey of the resources and devel- 


opment of the United States shows that her supremacy 
in commerce should be as unquestioned as her superior- 
ity in natural wealth, the native ability of her people 
and her system of transportation. But with reference 
to no other interest is there need of a closer study of 
laws and conditions; of policies based upon scientific 
principles rather than popular clamour; of a wise 
union of liberty with regulation, and encouragement 
to and reliance upon the natural forces that have 
directed the intercourse of other people for thousands 
of years and will guide it to the end. 


A^ progress is the development of order. A 
uniform method is the highest form of order. 
The benefit accruing to a people and their 
progress will be in proportion to the extent of their 
application of uniform methods to the production of 
what they require. This is the general law which may 
be discerned behind recent changes of method in the 
industrial world, too often foolishly attributed to some 
deliberate and evil plan of masterful individuals or 
large aggregations of capital. These are but instru- 
ments in the working out of the law; and it is of 
sufficient scope and importance, not only in our national 
life but in the world's life, to merit a more patient 
and impartial study than it usually receives. 

The tendency toward combination of interests en- 
gaged in large industrial undertakings is simply a 
part of that cooperation in the production, the dis- 
tribution and the exchange of wealth with which 
everybody has been familiar for centuries. When 
the pioneers in this country united to help build one 
another's houses, when they had a barn "raising," 
it was combination. When the owner of land or 
implements or capital in any other form first entered 



into partnership with labour to create more wealth, 
it was combination. When the corporation came into 
existence, through which many small amounts of 
capital could be massed, it marked a new era, just as 
much as when two men first lifted by their united 
strength some stone or tree trunk too heavy for them 
singly. Exactly as society and the work of the com- 
munity have become more complex, so have the means 
by which material ends are achieved grown larger 
and more powerful. The union of numerous dis- 
connected and weak railroads in one orderly and 
efficient system, the substitution of one great estab- 
lishment for many small plants, are part of the natural 
and inevitable evolution of united action among men. 
One misconception needs to be removed at the 
outset, in considering combinations of capital. I 
know no theory so fallacious as the popular conception 
of the nature and purpose of the consolidation of 
wealth. It does not mean the hoarding of money in a 
bag, so that its one possessor may delve in it up to his 
armpits. It means rather the effective organization 
of effort, the intelligent use of money which represents 
exerted physical or mental energy. The common 
conception of the capitalist as a man who hoards money, 
and of Wall Street as a place where the money supply 
of the country may be cornered and kept, to be doled 
out to the people only as they submit to terms imposed 
by its owners, no more represents any existing reality 
than does the picture of a dragon. For few things 
are more worthless or uneasy than capital unemployed; 


and wealth locked up in vaults in a great city is just 
as useless to its possessor as heaps of gold to Robinson 
Crusoe. Idle capital may create a national problem, 
and has caused widespread national distress, as surely 
as idle labour. 

The people who propose to sweep the new business 
method out of existence as a public menace forget 
one thing. We have reached a stage of national 
development where business must be done on a different 
plan from that which served half a century ago. In 
1865 we had thirty-five millions of people. To-day 
we have nearly ninety millions. By the middle of 
the century we shall have two hunHred millions. Less 
than thirty-five years ago horse cars filled the needs 
of urban transportation. To-day we could not pos- 
sibly get along without the trolley. In economic 
conditions, as in physical conditions, we must keep 
pace with the times. If the masses of the people are 
to continue to enjoy the prosperity and the comforts 
which they desire, old-fashioned methods are inadequate. 
People in this country live better to-day than they ever 
did before. They are better fed, housed and clothed. 
There are fewer drones in the hive, fewer people who 
share the results of work without working themselves, 
less waste in the necessary processes by which population 
is sustained and business conducted. 

These are consequences of the better organi- 
zation of industry, of which large combinations are an 
important feature. It is as useless to propose doing 
without them as it would be to go back to the horse 


car, or to insist that the shoemaker at his bench should 
make with his hands the entire amount of footwear 
used by all the people of the country. And this expan- 
sion and improvement of method must continue. It 
will not move backward. 

There has been and still is a more or less common 
feeling of hostility on the part of the public toward 
consolidations, though it is yielding perceptibly to 
the growth of intelligence and to the demonstration 
of benefits in many instances by the conduct of industry 
on a large scale. This attitude is pronounced, but 
the reasons for it are not always plainly stated. Some 
of it is due to the unfortunate form taken by combina- 
tion at the beginning in this country. To obviate 
ruinous competition, what were called "trusts" were 
formed. Under this system the stocks of various 
and competing organizations were trusteed in the 
hands of a few men, to whom was given arbitrary 
authority to do as they pleased with the properties 
under their control. This was not a wholesome 
arrangement. It was a cumbrous structure, and it 
was declared illegal by the courts. It exists now, if 
at all, secretly, and must not be confounded with the 
rise of one big company out of many small ones, which 
is the feature of industrial consolidation. But it 
lasted long enough to stir up prejudice that has been 
transferred to some extent to a successor altogether 

Most opposition, however, is based upon the pro- 
position that the so-called " trusts" -for we still lack 


in common usage a more fitting name for industrial 
combinations work toward monopoly. The mo- 
nopolistic feature, with its supposed control of product 
and command of prices, fills the public mind to such 
an extent that the underlying principle has been too 
little considered. 

On this point several facts contrary to the extreme 
monopolistic theory may be noted : 

First: The largest manufacturing combination in 
this country does not control 50 per cent, of the product 
of the commodity it deals with. 

Second: Unrestricted competition has shown itself 
no unmixed blessing. In many cases it has produced 
results as evil as those of complete monopoly would 
be if such a thing existed. 

Third: No combination in this country will ever 
rise superior to public opinion or be able long to defy 
it. Virtual monopolies that control through price 
agreements certain lines of manufactured articles 
would be smashed by the abolition of protective duties 
on these articles. An actual monopoly, controlling 
all production and squeezing the people, could and 
would be driven out of business by popular revolt. 

Fourth: Steadiness of prices and profits is regarded 
by capital everywhere, and by every management 
intelligent enough to hold its place, as far more desirable 
than excessive prices and undue profits. 

Fifth: It thus appears that there is a law of balance 
and proportion in the operation of consolidated indus- 
tries, not at first perceived or known, which insists 


upon moderation as a condition of their very existence 
and will destroy them, sooner or later, if violated. 

Sixth: There is the regulative power of actual law, 
exhibited in "anti-trust" statutes all over the country, 
which at present tends rather to bind industrial devel- 
opment harmfully than allow to it dangerous freedom. 
Undoubtedly, if consolidation should ever threaten 
the public welfare or the place of the individual as a 
free industrial unit, this authority would be further 
asserted and extended. 

These are all valid reasons why the popular an- 
tipathy to all forms of combination should be laid 
aside, and the subject investigated without prepos- 
session, like any other phenomenon, such as different 
systems of land tenure, or the value of synthetic 
chemistry in manufacture, or other changes in indus- 
trial method within very recent times. 

Assuming the public to be able to protect itself 
against extortion, there are only a few men in the 
community who can advance good reasons for opposi- 
tion to the new system. These are the middlemen, 
and the small competitor who is unable to meet the 
larger concern in open market. They are caught 
between the upper and the nether millstones. The 
former has no just reason for complaint. He is not a 
producer. His work was just so much economic 
waste, which is saved by shortening the connection 
between producer and consumer. The latter is less 
freely forced to the wall than is supposed. 

It has appeared in nearly all the investigations 


recently conducted under the Sherman anti-trust law 
that the small competitor still exists; that as soon as 
he is forced out or bought out, another of him appears; 
that no pressure is strong enough to eliminate him 
altogether, and that the wisest concerns neither try nor 
desire to do so. But, in so far as the small business 
man is put at a disadvantage, we must consider his 
injury, if the principle of consolidation has come to 
stay, as only one more instance of the hardships that 
always accompany progress. 

So far as we can see now, the greatest number - 
whose good must be considered first is benefited, 
just as it has been by the invention of machinery. Yet 
every machine displaces many men. The printer 
who set type by hand has had to find another job since 
the linotype came into general use. Almost every 
improvement that helps the many brings injury to 
individuals here and there. The building of a rail- 
road puts the owner of the stage coach out of business. 
All the trades have been revolutionized by machinery 
that threw men out of work or forced them to learn 
a new trade. But the community gains by the cheap- 
ening of processes and of prices, so that the balance 
is in favour of the improvements. We are so alive 
to the blessings of progress that we are apt to forget 
that they always cost something. But the advantage 
is great and sure, and the world has never refused 
to grasp it and pay the necessary price. 

On the other side of the balance sheet we may see 
what this compensating advantage is. In every such 


industrial improvement the chief beneficiary is the 
working man. For his gain is double; one in wages, 
and another in cheaper and more abundant food, 
shelter and clothing. By combining several concerns 
in one, many economies are made possible. Useless 
officers and unproductive middlemen are cut off. The 
systems of purchase and distribution are simplified. 
Economies are effected by the direct purchase of mate- 
rial in large quantities, or, better still, by acquisition 
of ample supplies of raw material. This enables the 
United States Steel Corporation to make high profits 
on its immense capitalization, at prices which give to 
smaller concerns only a modest return. 

The utilization of waste products is another economy 
which now not unfrequently furnishes the entire divi- 
dends of important factories; and when this has been 
carried as far and with as careful direction by practical 
chemists in the United States as in Germany, the results 
will be still more marked. The Carnegie Company 
built up its great success upon the fact that it took its 
iron from its own mines, made its coke in its own ovens, 
worked up its material in its own furnaces and shipped 
the finished product over its own railroad or in its own 
vessels. In the great Krupp Iron Works, of Germany, 
this system has been in operation for two generations; 
and, instead of arousing public antagonism, the Krupps 
have the admiration and good- will of the entire German 
nation from the Emperor down. 

Now this system obviously enables capital and labour 
to produce a better article at a lower first cost; and 


that is the rule of industrial progress in this country. 
Sometimes the demand for cheapness is too pressing, 
and quality deteriorates; but this quickly rights itself. 
Sometimes prices are forced up, but there is always 
in reserve capital and enterprise enough to enter the 
field when these pass the boundary of a reasonable 

It is a common habit to attribute the rise of prices 
during the last ten years entirely to combinations and 
resulting monopoly. In some instances these have 
contributed, but there are other powerful causes. The 
increase in wages and the decrease in hours of labour, 
the protective tariff that excludes foreign competition, 
and the enormous increase in the volume of money and 
credits might account for the whole of the increase in 
prices. So far as modern industrial methods are con- 
cerned, we may fairly say that their net result has been 
to cheapen production, and thus to place more of the 
comforts of life within the reach of the people. 

That the condition of labour has been improved 
by the growth of big employing concerns is patent. 
Strikes are more infrequent when a general schedule 
of wages is fixed by a central management. This can 
be done when the danger of disturbance to trade 
through erratic action by some individual operator is 
lessened. It is easier for organized labour to deal 
with organized capital. Within the last ten years it 
has been shown repeatedly how much more infrequent 
are ruptures between large corporations and their 
employees, and how much more prompt and satis- 


factory the settlement than when disturbance might 
arise in any one of a score of centers and be prolonged 
through the obstinacy of any one of a score of manage- 
ments or labour committees. The big concern can 
afford to purchase and must have the latest and most 
improved machinery. It cannot afford to lay off its 
men except in extreme cases, because the loss of a day 
is a serious item in its business. 

The workingmen, too, may participate in profits by 
investing their savings in the shares of the more solid 
and prosperous concerns. The profits of the old cor- 
poration went to a very few persons. It is easy for even 
a labourer to know in these days what consolidations 
are organized and run on a business basis, and he has 
such an opportunity as never before for safe and lucra- 
tive investment that will enable him to share in the 
gains of his own labour and his employer's capital. 
Of the nearly $4,000,000,000 of deposits in the savings 
banks of this country, the bulk consists of the savings 
of labour; and this represents but a portion of its 
accumulations. With such resources, the workingmen 
of the country might, if they chose, practically control 
a large part of its industry within a few years. From 
every point of view, the workingman, representing 
the greatest number whose good a sound industrial 
order must seek, appears to be the principal gainer 
from the new order in the world of wealth production. 

We must beware, however, of rash and sweeping 
conclusions in either direction. One of the great 
faults of the American public is its readiness to accept 


extreme views. The system of combination in business 
has been denounced in unmeasured terms. We have 
seen that it does not deserve such abuse. Neither, 
probably, is it the universal panacea that many people 
think it, or destined to be final in its present shape. 
We are, as yet, no more than on the threshold of the 
new era. We must draw proper distinctions. 

Already it is clear enough that the greatest value of 
industrial combination lies in the fields calling for 
immense capital, where big quantities of raw material 
must be controlled, huge plants erected, costly machin- 
ery provided and a universal demand supplied. The 
big instrument is for the big work, such as the iron 
and steel trade and its like. In some lines the old- 
fashioned small corporations will do the work better, 
and they are doing it. A railroad does not use the 
same locomotive for its mountain division and its 
switching yards. 

The theory that business consolidation in certain 
employments is a good policy for everybody appears 
to be justified by experience. Against the alleged 
injury that is intangible can be set the benefit which 
figures prove benefit to the workingman, to the 
consumer, to the capitalist. Wages are higher, prices 
have not risen in proportion, well-chosen investments 
are safer, more productive and more certain of return. 
The unsound combination must be weeded out; and 
time is doing that. The proper boundaries within 
which consolidation is the best working principle 
must be ascertained; and time and experience are 


doing that. When a longer trial has taught us more 
of the new method, and removed or restrained its 
abuses, it will undoubtedly be discovered that much 
has been added by it to the resources, the productive 
power and the well-being of man as an individual 
worker, and still more to the efficiency of the industrial 
association of mankind. 

Fiercer than the controversy over the relative merits 
of competition and consolidation as applied to manu- 
facture has been the discussion of them as applied to 
transportation. Originally the railroad property of 
the country consisted of a large number of small pieces 
of track, operated by companies unconnected with and 
often hostile to one another. This was natural in a 
period when the main purpose of the railroad was 
still to serve local needs; to connect with the larger 
business centres of the country the territory immedi- 
ately served by them. 

With the settlement of the West, and especially 
with the growth of through traffic, a new condition 
arose. The difficulty of sending commodities over 
half a dozen lines, operated by as many companies, 
in one quick and continuous journey became too great 
for business to bear. What happened to the currency 
of the country happened to its railroad business. In 
the period before the war it was possible for the people 
to get along with notes issued by state banks because 
business was largely local, travel was limited and 
financial enterprises comparatively small. Such a 
system would be intolerable to-day. And to handle 


the immense through railroad business of this country 
by a host of small and isolated lines would be just as 
impracticable as to carry on our commerce with forty- 
six different kinds of money. Consolidation appeared 
as naturally and as inevitably as the triple expansion 
engine displaces that of an earlier type. 

Now this was an economic evolution, independent 
of the plans or wishes of men. It had to be, just as 
men had to learn the use of fire if they were to become 
civilized. But a vast pother rose over the change; 
a cloud of law-making appeared; the comparative 
desirability of free competition and general consolida- 
tion in the transportation business was debated with a 
sort of frenzy, as if it could be settled by words; and 
men are still talking and legislative bodies still passing 
new laws to establish or save competition in railroading, 
as if this were something under their control. The 
building of parallel lines has been encouraged and 
bitter rate wars have been welcomed as an assurance 
to the people of competition for their benefit. 

As a matter of fact, these things mean the waste of 
capital supplied by the people; mean losses paid by 
the people. If there are two lines where one would 
suffice, the added burden falls on the public. A rail- 
road must either earn money to operate it, or borrow. 
In either case the people foot the bills. The fortunes 
\ of railroad companies are determined by the law 
of the survival of the fittest. This has already grouped 
the railroads of other countries into a few great 
systems, operated in harmony with one another. It 


has reduced scores of railroad corporations in New 
England to two systems, whose merger is substantially 
accomplished. All over the country it has built up 
big, efficient transportation machines, out of little 
scraps of lines that served neither the public nor their 
stockholders satisfactorily. And the interesting fact, 
as we shall see in the later chapters devoted to "The 
Railroad" specifically, is that this process has been 
contemporaneous with such a cheapening of the cost 
of transportation to the public as was never known 
before in the history of the world, and with a re- 
markable development of efficiency in the handling of 
an unprecedented volume of business. 

The law-making authority has fluttered about this 
natural and necessary transformation much as a fly 
buzzes about a horse. It can sting and annoy, but it 
neither hastens nor impedes the progress of the horse un- 
less the flies are thick enough and can bite hard enough 
to bring him to a halt in the effort to drive them away. 

In the first place, railroad consolidation was pro- 
hibited by law almost everywhere, because it was 
considered destructive of competition. Now, whatever 
may be argued about competition in the abstract, it 
can apply to transportation only in the large field and 
the large sense. To a certain extent, a railroad is a 
natural monopoly. There is room for only so many 
in a given territory. Excessive competition may encour- 
age temporary rate cutting; but no business can ever 
continue long on a losing basis. Sooner or later a 
restoration of rates, some understanding or agreement, 


comes to make existence possible to the railroads; 
and then for every line in the territory in excess of 
what is required to carry its business, the public will 
pay and continue to pay. Self-preservation, which 
! is a law stronger than any legislature, has nullified 
competition over large areas, manifestly to the welfare 
of their people. Consolidation still proceeds, and the 
impossibility of arresting it or doing the business of 
the country without it is now admitted even by those 
who would protest against removing these inoperative 
laws from the statute book. 

It also happened, curiously enough, that while 
legislative bodies were forbidding consolidation through 
one set of laws, they were compelling it through another. 
The assertion by the state of control of the rate-making 
power, in the slightest degree, at once logically destroyed 
the possibility of competition. For universal compe- 
tition can exist only where prices are absolutely free 
to go up and down without regulation or limit; until 
the competing concerns and the public that they serve 
meet on the level of the cheapest service that is consis- 
tent with a reasonable profit, or until some competitors 
are forced to the wall. Competition involves and 
requires charges which are at times unreasonable, 
unequal and unfair. It thrives on discrimination. 
From the moment when these things were banned by 
the law, combination was authorized and forced. 

The principles of rate-making laid down in the 
interstate commerce law and the decisions rendered 
under it absolutely prohibit competition. Ever since 


they became effective, railroads have been obliged to 
come together, to agree on rates over large areas, to 
save expense by making one management do what it 
had taken many to do before. As has been shown, 
permanent competition in railroading would be impos- 
sible in the nature of things. But the force which has 
hastened consolidation and imposed it upon all rail- 
roads that would render good service at a fair price 
and also keep out of bankruptcy is the rate regulation 
of the last twenty-five years. To this end the wholly 
contradictory ideas of law-makers, supporting competi- 
tion, opposing combination, and yet ordering uniformity 
of rates under heavy penalties, have worked together 
until the public itself has accepted the modern method 
as a necessity. It will presently recognize it as a good. 
For, in addition to the benefits pointed out as 
consequences of consolidation in industrial growth, 
especially as affecting the workingman, many others 
have accrued to the public by reason of the grouping 
of railroads into large systems. In Europe, where the 
population is dense, this fact has long been recognized, 
and the paralleling of a railroad is forbidden by law. 
Good service can be given only by a road that is 
making money. The people are the chief sufferers 
wherever a railroad is operated at a loss. Formerly 
every small railroad that began nowhere and ended 
at the crossroads had its president, vice-president and 
full complement of other officers, all drawing good 
salaries. For these there is now one series of officers 
and one set of salaries. Economy has marked every 


stage of the welding of these little railroads together; 
but all other gains are insignificant when compared 
with the enormous increase of efficiency in operation 
and the decrease in cost to the public. 

I will not go into this matter here at length, since I 
shall discuss it fully and with the necessary statistical 
comparisons in other chapters, and give a measure of 
the practical transformation of the transportation 
business by consolidation; of how, by this means alone, 
the carriers of the country have been enabled to handle 
its business and, at the same time, reduce rates until 
the freight charges on American railroads are only a 
fraction of those in other countries. 

The whole story can be compressed into a single 
statement. The last twenty-five years cover the period 
of active consolidation among the railroads of the 
United States, until the extent of the groups that will 
finally survive and the territory served by each can 
be roughly approximated. While this was going on, 
the average receipt per passenger per mile on all the 
railroads of the United States dropped from 2.42 cents 
in 1883 to 2.01 cents in 1906; and the average freight 
rate per ton per mile fell nearly 40 per cent., from 1.22 
cents to .77. 

In fact, every legitimate railroad combination, by 
which I mean one having a business as distinguished 
from a stock-jobbing motive, is intended to produce 
and does produce better service and lower rates on 
the side of the public, and either larger or more certain 
profits or both on the side of the stockholder. 


Take the Northern Securities Company for example. 
It contemplated no power and had no power under 
its charter to operate a railroad. The purpose of it 
was to enable owners of large amounts of stock in 
both the Great Northern and the Northern Pacific 
companies to put them into a common holding concern, 
where they would be secure against change. It was 
a labour-saving device, and a device contributing to 
the welfare of the public by assuring in the manage- 
ment of great properties that security, harmony and 
relief from various forms of waste out of which grow 
lower rates just as surely as dividends. The courts 
asserted that it had the power to restrain trade; that 
the power to do a thing is as objectionable as the doing 
of it; that is to say, that since with your hand you may 
kill a man, it is against public policy for a man to have 

So the Northern Securities Company went out of 
business. What has been the result ? What is the 
difference ? To the owners of the properties, merely 
the inconvenience of holding two certificates of stock 
of different colours instead of one, and of keeping 
track of two different sets of securities. To the public, 
no difference at all except that it has missed the advan- 
tages which the simpler and more businesslike plan 
would have secured. 

Take the purchase of the Burlington property by 
the Great Northern and the Northern Pacific jointly. 
What was the purpose and what the results of that ? 
The public seems to think that when a consolidation 


of properties is effected, all the small stockholders 
will, by some mysterious and awful process, be " frozen 
out," and that their property will be gobbled up by a 
few men. Nobody has lost anything by this trans- 
action. The Burlington reaches over its own rails 
Chicago, Peoria, Rock Island, Davenport, St. Louis, 
St. Joseph, Kansas City, Omaha, Denver, and thus 
connects with the main arteries of traffic of the whole 
country. All the large slaughter houses of the country 
are located in centres reached by that road. Four- 
fifths of the silver and lead smelters in the United 
States are situated along it. In counties reached by 
the Burlington system in Illinois, 90 per cent, of the 
manufacturing in the state is done. Much of its 
territory offers a market for the lumber of the Pacific 
Coast. To put these markets and products in touch 
with one another is worth something. 

If hundreds of millions of dollars had been raised 
to construct this system, or if another like it had been 
built beside it with new capital, it would have been 
hailed everywhere with approval as a means of bringing 
the Northwest and the Southwest together, of increasing 
the business of all the lines concerned and adding 
to the prosperity of both sections of the country. This 
is what has been brought about without the waste of 
capital involved in duplicating construction; and the 
service is just as real, the benefit just as susceptible of 

The question of stock ownership is to be considered 
in the light of a great competitive condition between 


the territories served by different large systems. There 
is competition between the Northwest and the South- 
west. There is effort to develop each section of the 
country, to secure business for and from one as against 
another. This form of competition has not been 
destroyed, and it is probably the only kind that is 
destined to remain fully operative in the transportation 
business. Consolidation is merely an incident on the 
road to efficient service. It cannot be against public 
interest, for we have already seen the greatest decline 
of rates in the period when it was proceeding most 
rapidly. It threatens no other dangers, because rail- 
way companies are subject to supervision and control, 
now extended to almost every detail of their operation, 
by the public. The amount of their capital is public. 
Their rates must be public and uniform. Reason- 
ableness of rates and service does not depend upon 
whether one man owns the capital stock of a railway 
or whether it is held by ten or ten thousand; by persons 
or corporations. And the courts are always open to see 
that the obligations of the common carrier are performed. 
The public, on its part, must understand that it 
cannot afford to build up a commercial system based 
on the supposition that the transportation business 
will be done at a loss. No such arrangement can 
possibly be permanent, Railroad rates and regulations, 
when prescribed by public authority, may easily be 
made such that no financial return for service remains 
after paying expenses. Somewhere before this point 
is reached the line must be drawn. Otherwise, if 


hope of a fair profit is cut off, private capital will no 
longer be put into railroads. Such conditions have 
been known in this country recently, and might easily 
become fixed. Then, since the traffic of the country 
must be carried, the only recourse would be to have 
the Government do the work. We can know what 
this would certainly mean. 

The experience of state-owned railroads in Europe, 
in Mexico and elsewhere, unable to sustain themselves 
without rates much higher than ours, although labour 
is far cheaper, our own experience in the conduct of 
all large undertakings by the government, proves 
that the work would cost from 50 per cent, more to 
several times as much as now. This added cost, 
together with the disadvantages of an inferior service, 
would fall on the people. They would have to carry 
the burden forever. They should take a second 
serious thought before inviting this possibility by meas- 
ures so drastic and unfair that capital will no longer 
engage in railroad enterprises. 

Whatever, then, may be thought of the application 
of the principle of combination to manufacturing, its 
work in connection with transportation appears to 
have been as beneficent as we have learned all natural 
laws to be when we have ceased to fear and begun to 
understand them. It is introducing system into the 
railroad business of the country. It is cutting out 
waste, driving out speculative interests, organizing 
transportation in a national sense as has never been 
done before, to the advantage of everybody concerned. 


For in the end the only community of interests that 
can exist permanently is the community between the 
producer of tonnage and the carrier. The railroads 
depend for their existence upon the products of the land 
they serve. The man out on the farm or in the forest 
or down in the mine must be able to sell his product 
at a profit, or he will cease to labour. When he has 
nothing to sell, there will be nothing for the railroad 
to carry. Individuals come and go, but the land of 
the country, its resources and the railroads will be 
here permanently; and they will either prosper or be 
poor together. 

There is one plain evil connected with the creation 
of certain great corporations that has not been corrected, 
although it is easily reached. The valid objection to 
many concerns, especially some of those known as 
"industrials," is that they appear to have been created 
in the first place not so much for the purpose of manu- 
facturing any particular commodity as for selling 
sheaves of printed securities which represent nothing 
more than the good will and prospective profits of the 
promoters. Nearly all the large concerns engaged in 
manufacture or trade that have come to grief owe 
their downfall to excessive capitalization. This is 
a real menace not only to their successful existence 
but to the public, which pays prices based to some 
extent on the desire to make profits on more than the 
money invested. 

If it is the will of the general Government to prevent 
the growth of such corporations, it has always seemed 


to me that a simple remedy was within its reach. 
Under the constitutional provision allowing Congress 
to regulate commerce between the states, any company 
desiring to transact business outside of the state in 
which it is incorporated should be held to a uniform 
provision of Federal law; namely, that all should 
satisfy a commission that their capital stock was actually 
paid up in cash or in property taken at a fair valuation, 
just as the capital of a national bank must be certified 
to be paid up by the controller of the currency. 

It is only fair to a dealer in Minnesota or California 
or Oregon that, if a company claims to have ten, twenty, 
or fifty millions of capital, and wishes to do business 
in that state, he should know that its solvency and the 
honesty of its alleged capitalization have been passed 
upon by a Federal commission. With such a simple 
provision of law, the temptation to make companies 
for the purpose of selling prospective profits would be 
at an end; and, at the same time, no legitimate business 
would suffer. Nor could any number of individuals 
desirous of engaging in business as a corporation suffer 
any hardship by being obliged to prove that their 
capital was as advertised; that they were not beginning 
to deal with the public under false pretenses. 

I am convinced that this is the simplest, most effec- 
tive and necessary regulation to be applied to modern 
business methods. It begins at the beginning. It 
not only attacks the practice by which millions of the 
people's money have been coaxed into bad investments, 
but it also bears directly upon the main evil attributed 


to the existence of big corporations. With it they 
would lose most of their incentive to any such wrong- 
doing as may be within their power. With it there 
would be little inducement to claim exorbitant profits 
by raising prices, because the fact could no longer be 
concealed by spreading the net return over a fictitious 

And of course it follows equally that where capital 
has been fully paid in, no interference should be allowed, 
because no injustice would be likely to be done. Yet, 
although this remedy has been all the time within easy 
reach, although it has been before the public, I myself 
calling attention to and recommending it in an address 
and in published articles eight years ago, it is still 
untried, while legislators go on debating the impossible j 
suppression of a natural law. 

The laws of trade are as certain in their operation \ 
as the laws of gravitation. The combination of forces 
to accomplish ends to which singly they are unequal 
is one of these natural laws. You might as well try 
to set a broken arm by statute as to change a commercial 
law by legislative enactment. We have been as a 
nation too ready to look to State and Federal legislation 
for remedies beyond their power to give. You may 
obstruct and delay for a time, but in the end the inex- 
orable law of experience and the survival of the fittest 
will prevail. That is a law of universal operation, 
and in its working it appears to be eternal. The wise 
course for us is to try all things, to keep that which is 
good, to work with intelligence and by the light of 


past experience toward that which is better, and thus 
to sift methods and secure in the end results beneficial 
to every individual, to every interest, to national devel- 
opment and prosperity. 

Such combinations as are evil, and some there are, 
will be found self-destroying. The large material 
view of things as well as the moral shows that the 
affairs of men are subject to a moral order. That 
which is wrong cannot continue indefinitely. Every 
mistake carries within it the seed of failure. Every 
device of man is tried by final facts; and not one which 
is not fitted to promote his progress and to assist in 
the betterment of human conditions and the advance 
of human societies will survive. All history shows 
this. Therefore, in so far as the principle of collective 
effort through great corporations is wholly self-seeking, 
aims at unjust ends or offends the law of national 
growth, it will perish. 

Especially in a country of free institutions and 
among a people accustomed to act independently it 
is impossible to conceive of any lasting triumph of 
a bad method. The people of this country could 
to-morrow, if they saw fit, and if they thought that 
the emergency called for measures so radical, starve 
any great industrial concern by refusing for the time 
to do business with it. It is always possible, however 
inconvenient or unlikely, for mankind in a crisis to go 
back for a time to the mode of life in which needs were 
simple and could be satisfied near at hand. A month 
of starvation would bring any big business to terms. 


But no such extreme course will ever be necessary. 
For already a survey of the last quarter of a century 
will show how rapidly industry is conforming itself to 
the law of combination, how excellent is the result in 
abundance of product, a raising of the general standard 
of comfort, improvement in the condition of working 
people and greater steadiness of markets and prices 
of both raw materials and finished products. These 
advantages the world will not part with. The undesir- 
able consequences of the new method have already 
been guarded against to a great extent; and the 
remainder will either be remedied in like manner or 
cast off just as the human system rejects the poisons 
and retains the nourishment generated from food by 
the bodily processes. 

The principle of consolidation in business within 
proper limitations and safeguards is a permanent 
addition to the forward-moving forces of the world. 
We shall no more abandon it, we could no more 
live our lives now without it, than we could consent 
to dissolve our governments, forget all our complex 
social relationships and return to the simple but barren 
life of isolation bought by hardship and a stunted 
existence supported by the chase. 


WHILE the development of the American 
Northwest occupied but the space of a 
single lifetime, it has affected the past 
more profoundly and will influence the future more 
widely than many events of greater historic moment. 
It has stimulated and financed immigration. It has 
supplied a large share of the world's food. It has given 
homes to an army of workers who began with little or 
no capital. It has revolutionized some industries and 
created others. It has opened opportunity for the 
increase of wealth and for human progress. It is worth 
while to examine in some detail the causes, the pro- 
portions and the future relations of a growth which 
daily familiarity has not yet robbed of its marvels. 

However each event may be bound to every other 
in the general scheme of things, it is certainly true 
that the development of the Northwest has a wide 
reaction upon human life and history. A high scientific 
authority says that "the central portion of North 
America affords the largest intimately connected 
field which is suited to the uses of our race/' Land 
is a first and indispensable human requirement. 
It is the main support and resource of man. The 



imperial area of the American Northwest, using that 

term in its broadest meaning, constitutes one of the 
largest, most compact and most productive resources of 
the whole human race. We are dealing with a great 
opportunity and a precious possession. 

It is by no accident that the cruel and rapacious 
gold-hunters, Cortez and Pizarro, are associated 
with the invasion of this continent on the south, 
while the first comers to the Northwest were Hennepin, 
Marquette, and La Salle. The lowest ambition 
of the latter was to win a new empire for the king. 
The highest was to Christianize the Indian tribes 
then inhabitating these wilds. Therefore serenity 
and elevation of thought mark the earliest annals 
of our central valley. Behind explorers and mission- 
aries marched settlers of corresponding quality; men 
of stern mind and sturdy frame, whose virtues have 
coloured the lives of their descendants. So the North- 
west grew and became the most signal instance of 
the rise of states and the reward of industry. How 
sudden this rise, how great the reward, one comprehends 
best after comparing the oak of the present with 
the acorn of half a century ago. 

In 1850 "The Northwest" was a term of vague 
meaning. It applied to territory beginning west of 
the Alleghanies, with Ohio, and stretching southward 
and westward to include the greater portion of the 
Louisiana Purchase. Sometimes it was held to include 
portions of the Pacific Coast, then almost as unknown 
as another continent. The population of the portion 


north of the Missouri and west of Indiana showed 
the following gains between 1850 and 1900. 

STATES 1850 1900 

Illinois 851,470 4,821,550 

Wisconsin 35>39 l 2,069,042 

Iowa 192,214 2,231,853 

Minnesota 6,077 I >75 1 >394 

North Dakota .... 319,146 

South Dakota .... 401,570 

Total ..... i>355>i52 i J >594>555 

In addition to the 11,594,555 population of this 
group, Kansas and Nebraska had 2,536,795 people; 
and Montana, Idaho, Washington and Oregon 
1,336,740 more. Without, therefore, including those 
other states of the interior basin generally reckoned 
a part of the Northwest, these twelve commonwealths 
contained in 1900 more than fifteen million inhabitants. 
Their population was practically multiplied by twelve 
in the last half of the last century. To-day they have 
millions more people than they had ten years ago. This 
growth has no parallel. Never before was a wilderness 
of such proportions reclaimed, never before did a 
population so increase within the same limits of time. 

The contrast in other respects is even more startling. 
The Federal authorities who, in 1850, gathered all 
the national statistics into a single modest volume, 
had not only fewer activities to chronicle but they 
followed a different standard. Aside from enumerating 
population, they were interested mainly in three things; 


the spread of education, the growth and extension 
of religious activity, and the progress of agriculture. 
Along these lines only can a comparison be made. 
The number of pupils attending colleges and public 
schools in the middle of the last century in the territory 
under consideration was 274,395. In 1902 it was 
more than three and a half millions in the country 
extending from Lake Michigan to the Pacific. The 
tables of occupation, the opening of farm and railroad 
and factory, present the change even more vividly. 
In 1850 there was practically no agriculture beyond 
the western borders of Illinois, Wisconsin, Iowa and 
Minnesota Territory. These had 6,914,761 acres 
of improved and 10,864,254 acres of unimproved 
farm lands; valued, with improvements, at more 
than $150,000,000. Fifty years later these same divi- 
sions, with the Dakotas, contained 108,216,831 
acres of improved and 39,876,715 acres of unim- 
proved farm land; valued, with improvements, at 
$5,037,720,205. Kansas and Nebraska by this time 
had added 43,473,145 acres of improved and 28,101,604 
acres of unimproved farm land, valued at$i,22i,3i2,79O. 
In Washington, Idaho, Montana and Oregon there 
were 9,944,087 acres of improved and 23,675,895 
acres of unimproved farm land, valued at $352,291,497. 
The census of 1910 will show that even this rate of 
progress has been surpassed during the past decade 
in the far Western states. 

In these fifty years there were added three times 
as many farms as had been opened in the whole two 


hundred and fifty years from the settlement of America. 
The addition to acreage was 547,640,932 acres, or 
nearly twice as much as all opened up before 1850. 
Of this growth the twelve states constituting what 
is most properly included under "The Northwest " 
had 235,509,262 acres, or very nearly one-half of the 
total addition to farm area in the United States, 
although all other parts of the country had known 
marvellous growth. They had about one-seventeenth of 
the entire farm area in 1850 and about one-third in 1900. 
Prior to 1850 over three-fourths of the total value 
of farm land was found east and south of the Ohio 
River. The value of farm property per acre in that 
year was $13.51 for the whole country, but in the West- 
ern states it was only $1.86. In 1900 the average 
value per acre for the country had risen to $24.39, 
and of this increase the rich soils of the West contributed 
the larger share. To-day it has been still further 
increased. There is no better measure of this growth, 
especially for more recent years, than the following 
table, giving the total combined receipts of grain, 
including wheat, corn, oats and flour each barrel 
of flour being reckoned as four and a half bushels of 
wheat at four principal Northwestern markets. 


I 887.. 23,649,694 48,618,563 31,960,319 163,437,724 

1 907.. 84,550,4 1 2 134,991,765 58,928,462 307,246,141 

Fifty years ago manufacturing in the Northwest 
was only a name. Lumber and flour were prepared 


and marketed and a few hands were at work producing 
textiles of coarse fabric. The entire value of home- 
made manufactures in Illinois, Wisconsin and Iowa, 
the only portion of our Northwest from which any 
manufacturing return whatever was made in the census 
of 1850, was $1,420,818. The shops and factories of 
the State of Illinois alone turned out in 1905 manu- 
factured goods valued at almost exactly one thousand 
times that sum; three and a third times as much for 
every working day as the entire territory could show 
for its year's labour half a century ago. Facts like 
these hammer home a sense of the magnitude of the 
development of the Northwest and its place in the 
progress not only of this nation but of the world. 

In 1850 the total valuation of real and personal 
property combined in Illinois was $156,265,006; it is 
now largely in excess of a billion dollars. In the same 
year the returned valuation of Iowa was $23,714,638 
and of Wisconsin $42,056,595. Minnesota, Kansas 
and Nebraska made no returns, their property values 
being scattered and trifling. The real and personal 
property of these six states and territories, representing 
the genesis of the Northwest, amounted to no more 
than $222,036,239. 

The latest assessment returns are incomplete and 
far from dependable, but they show property on the 
rolls of the six states to the amount of $8,348,868,366; 
while the grand total of this added to the valuations 
for the other six commonwealths of the Northwest 
westward to the Pacific is $10,739,709,268. These 


tangible assets represent the growth, in a little over 
half a century, of land and its improvements, and that 
small fraction of other property value which is included 
in the tax lists. The exchanges of the clearing-houses 
in 1908 at Chicago, St. Louis, Kansas City and Min- 
neapolis were nearly one-third of those of the fifteen 
most important cities of the country, excluding New 

Immigration and industry have transformed a 
wilderness in half a century into the home of plenty. 
The single influence that has contributed most to this 
astonishing work is, of course, the rise and scientific 
development of the modern transportation system. 
In the early fifties of the last century the railroad as 
a factor in national growth was little considered and 
less understood. The union by rail of the Great Lakes 
with the Atlantic took place as late as 1850. Chicago 
then contained less than 30,000 people, and the whole 
crude development of the Northwest depended upon 
its waterways and upon the prairie schooner. The 
engineers sent out in 1852 to make the original surveys 
for the Illinois Central across the prairies found their 
camps frequently invaded by wolves. The principal 
railroad lines in operation in the country were from 
New York to Boston, from New York to Buffalo, 
Philadelphia, Baltimore and Pittsburgh; from Detroit 
headed toward Chicago, and from Cincinnati to 

In the decade between 1850 and 1860 the average 
charge for carrying one ton of freight one mile was 


three cents or more. The freight on a bushel of wheat 
from Chicago to New York, utilizing lake and canal, 
was 26.62 cents. There can be no contrast more 
striking than that between the common carriers of 
fifty years ago and those of to-day. 

In 1850 there were a little over nine thousand miles 
of railroad in the United States. A few tracks had 
thrust themselves as far west as the Mississippi, but 
beyond that forest and plain were uninvaded by the 
iron highway. Twelve years later, in 1862, the whole 
railroad system of Minnesota, the gateway to the newer 
portion of the Northwest, was comprised in ten miles 
of track connecting St. Paul and St. Anthony. The 
scanty products of the country were shipped out by 
steamboat and barge; and had that remained un- 
changed, they would be scanty still. The railroad, 
aiding incoming population and growing industry, 
made the Northwest and added its immense resources 
to the wealth of the nation and the natural capital 
of the world. 

In 1857 Congress made a liberal grant of lands to 
Minnesota to aid in the construction of railways. The 
Territory transferred the grant to a corporation; and 
after its admission, the following year, the state loaned 
its credit to several companies. They all defaulted, 
and it was not until 1862 that the ten miles of road 
already referred to were completed by the St. Paul & 
Pacific, virtually a reorganization of one of the defunct 
concerns. This company was afterward divided, and 
its two sections prosecuted railway construction with 


varying fortunes until the financial collapse of 1873 
prostrated both. The properties were heavily and 
repeatedly mortgaged, their credit exhausted. Con- 
struction stopped; and with it the development which 
the Northwest had for a time enjoyed. Up to 1871 
some 285 miles of track had been completed, reaching 
the Red River at Breckenridge; and by the same date 
about five hundred miles of the Northern Pacific had 
been constructed. Now both enterprises stopped; 
and the Northwest grew only as settlement crept 
forward over the prairies a few miles each year in the 
wake of ox-teams. 

In 1878 four associates, George Stephen, now 
Lord Mountstephen; Donald A. Smith, now Lord 
Strathcona; Norman W. Kittson and myself obtained 
control of the St. Paul & Pacific's lines through pur- 
chase of its outstanding securities. The volume of 
these showed the large amount of money that had been 
invested, wisely or unwisely, in the original enterprises. 

Their stock aggregated $6,500,000 and their bonded 
indebtedness nearly $33,000,000, aside from floating 
obligations. These were all valid securities, had to 
be purchased in the market, and as the faith of the 
associates in the future of the Northwest was not 
shared generally at that time by men with capital 
to invest, they were obliged to pledge their possessions 
and strain their credit to secure the funds necessary 
not only to complete this purchase but to rush additional 
construction of new lines that must be built to save the 
land grant. The capitalization of the lines purchased 


and built was approximately $44,000,000, and the 
deal a large one for those days. 

In 1879 this property, then including 656 miles of 
railroad, was reorganized as the St. Paul, Minneapolis 
& Manitoba Railway Company. Since the common 
custom in reorganizations is to increase the total 
volume of indebtedness, it is worthy of mention, and 
has not been without its bearing upon the prosperous 
growth of the Northwest, that the capitalization of 
the new company was but $31,000,000; a scaling down 
of about 30 per cent. 

The problem of the railroad now became the problem 
of the Northwest. These great fertile spaces were 
to be opened to settlement as rapidly as capital could 
be amassed and energy applied to the work of con- 
struction. And settlement, thus stimulated, was con- 
tinually, on its part, pressing against transportation 
facilities and demanding their enlargement. Connec- 
tion was made with the Great Lakes by a line to Duluth, 
branches of the main line were pushed through the 
fertile lands of Minnesota and Dakota, and in 1893 
the transcontinental system was finished to the Pacific 

By that time the St. Paul, Minneapolis & Manitoba 
had become the Great Northern; and in 1907 all the 
subsidiary systems which, for convenience or of 
necessity, had been operated by the latter company 
were consolidated with it into one system which had 
grown in 1908 to a total of 6,743 miles operated. The 
addition of more than six thousand miles of new con- 


struction during thirty years is a fair measure of the 
growth of the Northwest, of whose common carriers 
this system is but one. One illustration will show 
what has happened to freight rates. When the railroad 
property was taken over from the receivers, the rate 
from St. Vincent to Duluth was 40 cents per hundred; 
now it is 13. 

The financing of such an enterprise is no less vital 
than its construction and operation. It began, as 
stated, with an issue of $3 1 ,000,000 of stock and bonds 
to represent property into which the proceeds of the 
sale of $44,000,000 of securities had previously been 
put. Extensions and the creation of great terminals 
called for increased capitalization from time to time. 
To a large extent betterments were paid for out of 
current earnings, instead of by new stock or bond 
issues. Rolling stock was provided in the same way; 
and the extent of this drain upon resources appears 
from the increase of 49 locomotives on the system 
originally to 1,081 in 1908; of passenger cars from 58 
to 802; and of freight and work cars from 761 to 43,890. 

To provide funds for the more than 6,000 miles of 
track added to the system by construction and purchase, 
the total of its capital stock and bonded debt had 
become, June 30, 1908, exclusive of the bonds of the 
Burlington system guaranteed jointly by the Great 
Northern and Northern Pacific, which the Burlington 
property amply secures and whose fixed charges it 
pays, $307,918,689. The growth of interest and 
confidence raised the number of stockholders from 


122 in 1892 to 15,000 in 1908, with an average holding 
of 140 shares, or $14,000 each. Between 1890 and 
1908 these stockholders paid in $160,000,000 in actual 
cash. This, in addition to the bond issues, represented 
the vast sum that had to be raised on faith in the prop- 
erty and the country, to keep the railroad system 
abreast of development in the Northwest. In the 
seventeen years 1891-1907, all the surplus earnings 
of the system and $1,366,728 additional were put 
back into the property in additions and betterments. 
The total outstanding stock and bonds per mile 
of main track for the Great Northern system amount 
to $45,031.77. Its terminal facilities could not be 
duplicated for any money. The small traffic of settlers 
and frontier posts has grown to the carriage of 
493,000,000 passengers and nearly six billion tons of 
freight one mile in 1908. Precisely as farm lands 
have increased from $2.50 an acre to $50 or $75, just 
as city lots now sell for more per front foot than their 
former whole value, sometimes more than the value 
of the entire town site thirty years ago, so the value 
of railroad property has increased with the growth 
of the country. One is as natural, as just and as 
deserved as the other. They arrive in such connection 
that each is cause and each effect of the other. But on 
the mere basis of assessed valuations, the total of railway 
capitalization or valuation is very small when compared 
with the total value added to private property within 
the same period. Both are of equal propriety and 
validity, and are entitled to the same return. 


N/ During the same period the Northern Pacific's 

transcontinental line was completed, the system was 
built up and reorganized, the Burlington extended 
into the Northwest, and the Milwaukee & St. Paul, 
the Northwestern, the Canadian Pacific and other 
companies contributed new mileage yearly to the 
facilities of this section. 

Nowhere else do comparative statistics show more 
accurately the rapidity of growth. In 1870 the total 
railway mileage of the United States was 52,922 and 
in 1890 it had grown to 166,793. The increase in 
these twenty years for the country was 215 per cent. 
But in those same years the mileage in the states 
beginning with Illinois on the East and extending to 
the Pacific Coast, including Nebraska on the south, 
increased 341 per cent. In the seven distinctively 
Northwestern states, Minnesota, the Dakotas, Mon- 
tana, Idaho, Washington and Oregon, the increase 
was 1,181 per cent. In 1907 these seven states had 
27,161 miles of railroad as against 16,863 m ^ es m 1890; 
and within their boundaries construction is proceeding 
more rapidly than elsewhere. 

While this labour of organization, of financing, 
of construction, of operation and of traffic building 
went forward, transportation charges fell progressively 
until now the Northwest has relatively that is, taking 
into account the newness of the country and compara- 
tive density of population and traffic the lowest 
railway rates in the world. 

This mutual benefit can continue only while the 


products of fields and factories are carried to the 
consumer on such terms as give its proper profit to 
each party to the transaction; thus encouraging the 
further increase of industry by guaranteeing to each its 
reasonable share of gain. The embodiment in practice 
of this principle that railroading is a business enterprise 
and not a speculation; that its chief interest is in the 
field, the factory and the mine rather than upon the 
stock exchange; that the intelligent and just system 
of profit-sharing between carrier and shipper embodied 
in reasonable rates will best promote the prosperity 
of both and enlarge the common heritage, is not the 
least of the contributions made by the Northwest 
to the development of the nation and the world within 
the last fifty years. 

So much for the past of the Northwest. The duty 
of its people now is to render secure its development 
and progress. The causes of its growth are to be 
found in the transfer of an immense population, sup- 
plied by our own natural increase and by immigration, 
to enormous areas of fertile soil. It was like opening 
the vaults of a treasury and bidding each man help 

But these conditions cannot be permanent. The 
present era is the crisis of the old order. The primary 
business of the Northwest hitherto has been the mastery 
of natural conditions. Its next contribution should 
be to the economic and social evolution of the race. 
We must determine upon a national economy quite 
different from the present when our population shall 


approach three times what it was in 1900. Striking 
as the contrast has been found between 1850 and 1900, 
that between 1900 and 1950 will reveal more serious 

Practically speaking, our public lands are about 
all occupied. Our other natural resources have been 
exploited with a lavish hand. Our iron and coal 
supplies will show signs of exhaustion before fifty 
years have passed. The former, at the present rate 
of increasing production, will be greatly reduced. 
Our forests are going rapidly; our supply of mineral 
oil flows to the ends of the earth. The soil of the 
country is being impoverished by careless treatment. 
In some of the richest portions of the country its 
productivity has deteriorated fully 50 per cent. These 
are facts to which necessity will compel our attention 
before we have reached the middle of this century. 
To a realization of our position, and especially to a 
jealous care of our land resources, both as to quantity 
and quality, to a mode of cultivation that will at once 
multiply the yield per acre and restore instead of 
impairing fertility, we must come without delay. 
There is no issue, in business or in politics, that com- 
pares in importance or in power with this. 

The outlook for our future has been summed up 
with rare accuracy and force by the late Professor 
Shaler in these words: 

"As the population becomes dense there will soon 
appear the dangers of poverty and misery that are apt 


to accompany a crowded civilization. The enormous 
pressure of masses of people seems to crush out the 
hope and energy and prosperity of a large proportion 
of them; and the great problem of modern progress, 
after all, is how to deal with this tendency how 
to prevent the forces of advancing social evolution from 
being destructive as well as creative." 

This is the problem of a nation, exactly stated; and 
it is, in a special sense, the problem of the Northwest. 
As here the noblest fruits of prosperity have been 
gathered, so here must be evolved methods to preserve 
them from decay. Leadership implies responsibility. 
It is the central area of this continent that gave the 
material and the stage for the latest phases of human 
progress. It is there that the problems which have 
baffled older nations, the processes as yet unaccom- 
plished, must be worked out. 

Nowhere else can be found more energy or more 
courage to join with great issues. The event will come 
not through mere boasting or through the accretion 
of wealth and the magnification of industries, but as 
all the works of science and all the revelations of 
natural law have been identified with our common 
life; by infinite patience, infinite study of facts as they 
are, infinite search for the right adaptation of means 
to ends, infinite devotion to the glory and perpetuity 
of our institutions and infinite love for man as he should 
and yet may be. 



THE history of our trade with the Orient is a 
tale of lost opportunity. Yet so much more 
popular are facts that tickle our pride than 
those hinting of neglect or mistake that comparatively 
few people to-day appreciate what this opportunity was, 
and to what extent and why we have lost it. 

The trade with the Orient is the oldest and most 
prized among men. Its origin and its value go back 
to the dawn of history. It built up many cities of an 
older world that are now heaps of ruins. For a time 
Byzantium enjoyed it, and to some extent by virtue 
of that fact became the capital of the East. Later 
on Venice, the city of merchant princes, was built 
upon the same commercial foundation, and for years 
that was the gateway through which Eastern traffic 
entered Europe. When the Portuguese and the 
Spaniards sent their ships around the Cape of Good 
Hope, they took possession of this trade and transferred 
it from the backs of camels to their galleons. From them 
it passed under the control of the Hanseatic League, 
to the great free cities and free merchants of Europe. 



Early in the last century Great Britain, following 
a far-seeing policy inaugurated by her ablest statesmen, 
took possession of this trade and has retained the 
lion's share of it to the present time. Her conquest 
of India gave her a foothold; her occupation of it a 
better understanding of the Orientals, their needs and 
methods; and because, through her enterprise and 
the breadth of her interests, she was able to furnish 
the most abundant and cheapest means of transporta- 
tion to and from the Orient, she has held her own 
until recently against all comers. The richness, the 
stability, the profitableness of this traffic have appealed 
to all nations. Might not the United States in its 
turn become first a sharer and afterward, perhaps, 
the director of this coveted commerce ? 

From the time when a northern trans-continental 
railroad line was completed this became a possibility. 
Across the Pacific Ocean, nearer by several hundred 
miles than it had ever been brought before, lay the 
trade empire that had been in communication with 
the rest of the world for so long by caravans across 
forbidding deserts, by long and dangerous voyages 
around the Cape of Good Hope or, in later days, by 
the still costly and tedious Suez route. The teas 
and silks, the rice and matting of China, of Japan and 
India, are marketed all over the world. They will 
continue to be bought and sold and transported; 
and millions of people in those countries will, as they 
progress, buy ever more and more largely in other 
markets. This oldest branch of trade seemed also 


to promise the greatest modern expansion. The 
short and direct route across the North Pacific from 
Puget Sound to Japan and China would save both 
time and cost in transportation. 

Conditions were favourable for a new commercial 
epoch in the relations of the Orient with the outside 
world. Not only might its people find advantage 
in dealing more largely with us than with other nations, 
but a large part of the vast stream of their commerce 
might be deflected at its origin, so as to turn eastward 
across the Pacific instead of westward across Asia 
or through the Indian Ocean. If this should prove 
feasible, the United States would gain an advantage 
not easily to be overestimated; would realize a dream 
that has held the minds of men since the time of 
Alexander the Great. It was the strategic moment; 
the opening of that doorway of opportunity for which 
men and nations wait. 

To reverse one of the great currents of traffic, to 
secure markets among people little accustomed to 
trade with us, to get the complicated machinery for 
such a development into place and working order, 
required study, preparation, the most careful adjust- 
ment of means to ends. 

A study of the lumber trade revealed the first favour- 
able opening. When the railways reached Puget 
Sound, they* found there the largest supply of standing 

*The Great Northern was completed through to the Coast in 1893. From that 
time the extension of American trade with the Orient was pushed vigorously in all 


timber in the world. For this there was at that time 
but a limited market. It reached the outer world only 
in the small quantities that sailing vessels carried 
up and down the coast or to foreign ports. The freight 
rate to the East, where alone it could be sold extensively, 
where the demand for it was greatest, was ninety cents 
per hundred pounds. This was prohibitive. The 
question was how to make a rate low enough to bring 
this lumber to the prairie country and the Mississippi 
valley. It could be done only by securing an ample 
and steady volume of traffic in both directions, so 
that neither eastbound nor westbound cars should 
be hauled empty. Low rates can be made only if 
cars moving in each direction are loaded. 

At the time the westbound business was heavier 
than the eastbound, and empty cars were coming east, 
on which lumber might be carried. When the lumber 
business should be developed into a heavy traffic, then 
the balance would turn in the other direction. Then 
westbound business would have to be increased again, 
else empty cars would be travelling nearly two thousand 
miles to the Pacific Coast. While the local develop- 
ment of the coast country was sure to be great, it would 
not supply sufficient volume of business at that time 
to equalize traffic. A market for our products in the 
Orient, if it could be built up, would not only do this 
but would be of the utmost value to every interest in 
this country. 

What material was there out of which to create such 
a trade ? Japan is small and densely populated and 


cannot feed its own inhabitants. There we might 
find customers for our foodstuffs. Russia even at 
that time, when her power on the Pacific seemed secure 
and was enlarging, would scarcely be a large buyer. 
China is a marvellously rich country, both for agricul- 
ture and in mineral resources. The Chinese are 
intelligent, good farmers, imitative, industrious and 
painstaking as only a people so gifted and so patient 
can be. They are also good traders. We must look 
for our market to the men who live in the most densely 
populated portions, along the sea. India was at once 
too distant and too poor to furnish a demand worth 
considering. But the Japanese and Chinese could 
be made customers for our flour in increasing quantity. 
A people once accustomed to the wheat loaf are slow 
to give it up. And the dense population would make 
consumption large. Both countries bought their cotton 
goods mostly from Europe. We might divide that 
trade or capture it. It was clear that, on the first 
close contact with the modern world, these races, 
with their cheap labour and their lively industrial 
skill, would soon begin to manufacture for themselves. 
They might get their machinery from us; they would 
come to us for a portion of their raw cotton. Until 
their manufacturing industry should be well developed, 
they would depend upon us to a considerable extent 
for their iron and steel. 

The total purchases outside of their own countries 
made by all the people living on the borders of the 
Pacific, including Oceania, amount to a billion and 


three quarters annually. Great Britain handles nearly 
one-fourth of this entire business. Although nearly 
all consists of commodities that the United States 
could furnish, we get about one-twentieth of it. Al- 
though our foreign trade is mostly done with the 
markets of Europe, we sell fewer manufactures there 
than the republics of South America buy from Europe. 
On the other side of the account are exports of silk, 
tea, matting and other Oriental products: not only 
the large quantities consumed in this country, coming 
to us by the Suez Canal and paying toll to the foreign 
importer and the foreign carrier, but the very supply 
of Europe itself; which we might be in position, with 
a low freight rate and an established trade, to bring 
over the Pacific, portage across the continent and deliver 
at European ports, thus wresting from the other half 
of the world a portion of the traffic that has been its 
prize for centuries. 

The best route, the traffic machinery to operate it, 
the market with its demand expanding in both directions 
- these were the conditions that opened to this country 
fifteen years ago such a commercial possibility as has 
rarely presented itself to any nation in history. Costly 
wars have been waged and provinces desolated for 
advantages not half so attractive or so real. 

So the effort was made to turn this conception into 
a business fact. For several years before that, the 
Orient as a market was carefully and thoroughly 
studied. At different times agents of the railoads 
investigated on the ground every trade possibility of 


the further shore of the Pacific. They lived among 
the people, they learned the market, they obtained 
manifests of every ship leaving for foreign ports, 
they inquired into economic conditions, they mixed 
with merchants, they laid the foundation for an intelli- 
gent, practical creation of commerce between the 
Orient and the United States. 

To build up any large trade with India was found 
impracticable. The land tax kept the people too poor 
to buy. The Government could not remit the land 
tax without destroying its own means of support. And 
the English grip on the market had accustomed the 
people to buy from their masters. But reports covering 
international trade conditions in Japan, China and the 
whole coast district of Eastern Asia confirmed the 
belief that here was a market of immense value and 
that it might be made ours. 

The first steps had to be taken and the whole burden 
assumed by the railroads. The birth and the growth of 
our commerce with the Orient would depend absolutely 
upon a favourable transportation rate. Having to 
meet the competition of the world, we must sell more 
cheaply and deliver more satisfactorily than the rest 
of the world. For this, such rates must be named 
as were unknown in transportation experience up to 
that time. This was done. The plan by which three 
great railroad systems, reaching directly the markets 
in this country most interested in both the imports 
and the exports of the Orient, should work together 
for the public benefit was maturing. 


The lumber business of the Pacific Coast made possi- 
ble the naming of a rate that should open to us the 
closed doors of the trans-Pacific East. The details 
then worked out have not lost their interest as a part 
of our economic history, although the splendid possi- 
bility they revealed has gone. 

At the beginning, the key to the situation was the 
lumber rate. There were 400,000,000,000 feet of 
standing timber on the Pacific Coast. It could not 
pay the ninety-cent freight rate to the East at that 
time, when lumber prices were but a fraction of what 
they are now. The railroads could not afford to haul 
empty cars West to carry that lumber East. It costs, 
roughly, $160 to haul a car 2,000 miles across the 
continent. But they could afford to carry lumber 
temporarily at a low rate rather than bring cars back 
empty. And if in this way the lumber business 
could be developed, it, in turn, would make possible 
later a low westbound rate, on which trade with the 
Orient could be built up. 

The lumbermen of the Pacific Northwest said that 
while the ninety-cent rate shut them out of the Eastern 
market, they could pay sixty-five cents and do business 
there. Market conditions at that time seemed, how- 
ever, to require a rate of not to exceed fifty cents. 
The railroads offered a forty-cent rate on fir and fifty 
cents on cedar, and those rates went into effect. In 
1900 the State of Washington produced 1,428,205,000 
feet of lumber; only six years later its product was 
4,305,053,000 feet, with a total value of $62,162,840. 


In the year 1906 Washington produced 61.5 per cent, 
of all the shingles produced in the United States. And 
the average mill value of Douglas fir, the principal 
lumber product of the Puget Sound forests, rose from 
$8.67 per thousand feet in 1899 to $14.20 in 1906. 

Before the State of Washington had direct rail 
connections with the East, one could not give cedar 
logs away. They used to let them run out into the 
sea to get rid of them. Because low rates gave value 
to them, the price has gone up to the present figure. 
These rates made literally billions of dollars for the 
North Pacific states. Resources were developed, the 
people of the interior eastward had a more abundant 
supply of better lumber at lower prices than ever 
before, and there was an unprecedented growth of 
population and prosperity upon the Pacific. 

The next and expected result was that the demand 
for this lumber grew until more cars of it were coming 
East than there were cars loaded with freight going 
West. To equalize the traffic movement again, more 
westbound tonnage was needed. It was found. Three 
cars of cotton were sent to Japan as an experiment, 
the railroads agreeing to take all the risks and bear 
all the expenses. A delegation from Japan passed 
through this country on its way to conclude a purchase 
of steel rails in Europe. The railroads guaranteed 
that the order would be duplicated at the price in this 
country. It could be done only by making a freight 
rate that would get the business; but it was done, 
and another entering wedge for the trade of the Orient 


was driven home. A low rate on cotton took it from 
the lower Mississippi valley, Alabama and Texas, 
and carried it 3,000 miles to Seattle for shipment. 
In one year the number of bales of cotton piece goods 
carried to Puget Sound increased from 13,070 to 64,542, 
and the number of pounds of raw cotton from 13,230,000 
to 41,230,000. More and more manufactured articles 
and other freight took the overland route from the 
East to the Orient. More and more inroads were 
made upon the trade of competing countries. More 
and more staples from all parts of the United States 
began to move westward. In nails, wire, machinery 
and other articles of that sort, a good business was 
built up in Japan and China. 

Of course it all had to be done just as all other 
markets have been created or conquered since com- 
merce began; that is, by making prices and rates that 
would beat all competitors. The mills of Minneapolis 
and those of Portland, Seattle and Spokane began to 
ship flour to Australia and to China and Japan. To 
make rates low enough for this, and to keep them 
low, steamships able to carry more cheaply than any 
steamships had ever done were needed. 

In 1896 the Japanese Steamship Company put on 
regular steamers to connect with the Puget Sound 
terminals. But if the Oriental trade was to expand as 
it clearly might and should, this arrangement would 
not answer. The mechanism of transportation must 
be as complete on sea as it already was on land. Some- 
body had to build ships that would carry at bottom 


figures. Most of the ships then on the Pacific were 
from 2,500 to 7,000 tons. To keep rates low the 
Minnesota and the Dakota, the greatest carriers in 
the world, were built. These were ships of 28,000 
tons, constructed as the advance guard of a fleet that 
should handle commerce as it developed. American 
trade with the Orient should be wholly under American 
control. No accident and no foreign power should 
be able to interfere with the low rate and the adequate 
service on which its fate must always depend. 

The business increased. The market was opened, 
the opportunity accepted, our trade with the Orient, 
no longer a dream, became a splendid fact, as the 
statistics show. In the ten years between 1893, when 
the Great Northern reached the coast, and 1903, the 
exports of the Puget Sound customs district increased 
from $5,085,958 to $32,410,367, or nearly 540 per cent. 
In those years our exports to Europe increased 50 per 
cent., to North America 80 per cent., to South America 
a little over 30 per cent., and to all Asia over 170 per 
cent. To Japan alone the increase was from 
$3,000,000 to $21,000,000, or 600 per cent.; to China, 
from $4,000,000 to $19,000,000; to Hongkong, from 
$4,000,000 to $8,000,000; and to the three, from 
$11,000,000 to $48,000,000, or over 300 per cent. At 
this rate it seemed that the bulk of the trade of the 
Orient was ours for the taking. 

The advantages of such a market are greater than 
appear upon the surface. Our people are so dispropor- 
tionately interested in the progress of manufacturing 


industry that, when new markets are mentioned, 
they think at once as a rule of places where our manu- 
factures may be sold. But as about three-fourths of 
our trade with the rest of the world consists of agricul- 
tural products and raw materials, additional customers 
for these are most to be desired. For every new draft 
upon our surplus of them enhances the price, and thus 
increases the reward of those engaged in adding to the 
real wealth of the country. 

Now a new market including from five hundred 
millions of people upward was worth considering. 
We could not export a large range of commodities 
to the Orient. A people whose labour is so cheap 
cannot afford many luxuries. Labour is so expensive 
in the United States that the Germans and the Belgians 
undersell our manufactured goods. But because this 
country can produce cotton, grain, iron ore and coal 
cheaper than others, there are some things that, with 
low freight rates, we could lay down in Japan and China 
for less money than any other country can. If the 
Chinese should spend only one cent per day per capita, 
it would amount to $4,000,000 a day, or nearly $1,500,- 
000,000 a year. We could not spare food enough 
to sell them that much. 

Most direct and perceptible was the benefit from 
opening such a market to the cultivators of the soil 
in this country; to the men who raise wheat and cotton 
and such other agricultural products as the Orient 
might absorb. Every additional bushel of wheat 
sold abroad tends to raise the price of the whole crop. 


The law of supply and demand is universal. The price 
of wheat is governed by it, and fluctuates according to 
the rise or fall of the visible supply, which is the world's 
surplus. Cut that down and the price goes up. 

Every bushel of wheat, every bale of cotton sold in 
the East is taken out of the market; is no longer here 
to compete in our shipments to Liverpool and Antwerp 
and other European ports. The farmers in New York 
and Ohio, in North Dakota and Washington must all 
be benefited; because the surplus is reduced by just 
so much, and the market price of the remainder is 
affected exactly as if that much less had been produced 
originally. A good authority computed the enhanced 
price of American wheat on account of actual shipments 
made to the Orient at from five to seven cents a bushel 
in this country. On a yield of 650,000,000 bushels 
this would be a clear gain of at least $32,500,000 in 
the national wealth; a gain bestowed where it would 
do most good in the pockets of the farmers of the 
country. And the like is true of cotton and of other 
commodities furnished by us to the Orient. 

Such was the opportunity created by the labours of 
years; such the value to the people of this country 
of constructive work in the field of Oriental trade. As 
we have followed the flow of that tide, we are now to 
watch its ebb. Destruction followed swiftly upon 
construction. Before considering the causes of the 
change, it will be well to examine the following table 
of commercial movements. The two sides of the 
wave, its advance and retreat, may be traced there 


mathematically. The figures are from the official 
publications of the United States: 




1890 .... $5,232,643 1890 . . . $21,103,324 

1896 .... 7,689,685 1896 . . . 25,537,038 

1905 .... 51,719,683 1905 . . . 51,821,629 

1907 .... 38,770,027 1907 . . . 68,910,594 

1908 .... 41,432,327 1908 . . . 68,107,545 




1890 . 

. . . $2,946,209 

1890 . 

. . $16,260,471 

1896 . 

. . . 6,921,933 

1896 . 

. . 22,023,004 

1905 . 

... 53,453,385 

1905 . 

. . 27,884,578 

1907 . 

. . . 25,704,532 

1907 . 

. . 33,436,542 

1908 . 

. . . 22,343,671 

1908 . 

. . 26,020,922 

1890 . 
1896 . 
1905 . 
1907 . 

1908 . 

. . . $19,696,820 
. . . 25,630,029 
. . . 128,504,610 
. . . 92,703,664 
. . 101,784,846 

1890 . 
1896 . 
1905 . 
1907 . 

1908 . 

. . $67,506,833 
. . 89,592,318 
. . 161,982,991 
. . 212,475,427 

. . 181,167,616 

1890 . . . $683,735,795 1890 . . .$449,987,266 

1896 . . . 673,043,753 1896 . . . 418,639,121 

1905 . . . 1,020,972,641 1905 . . . 540,773,092 

1907 . . . 1,298,452,389 1907 . . . 747,291,253 

1908 . . . 1,283,600,155 1908 . . . 608,014,147 




A"ER this development was well under way, 
the future depended almost entirely upon the 
attitude of the Government and the people. 
The railroads and the ships, the customers and the 
freight, were ready. This country had to give to the 
Japanese and the Chinese wheat flour so cheap that 
they would use it instead of rice. It had to compete with 
the combined enterprise of all the other countries of the 
world, where production is often much cheaper than it 
is in the United States. Profits had to be cut to the bone. 
The thing could be done; but only if those who were 
doing it were not hampered in dealing with that distant 
trade, so different in all its conditions from domestic 
commerce. From the beginning there were obstacles 
at home to be overcome, and these grew steadily in 
number and in difficulty. Results may be found in 
the preceding table. Our exports to Asia in 1890 
were less than 3 per cent, of those to Europe. By 
1905 they had risen to over 12 per cent. In the next 
three years they dropped to less than 8 per cent. It 
is a sharply defined trade movement. 



A direct restraint was the limitation by law of the 
rate-making power as applied to foreign trade. Over 
commerce on the high seas neither Congress nor the 
Interstate Commerce Commission has any direct 
authority. But their indirect control can be made 
complete and decisive. A through rate is made, say, 
from Chicago to Yokohama. That through rate is 
the affair of nobody but the transportation system 
that gives it and the merchant who gets it. Formerly 
the rate was made such as would get the business; 
because this was new trade, which it was desired to 
secure for the producers of the United States, and often 
to avoid hauling empty cars. If exceptionally low 
rates had to be given on a line of business or a heavy 
consignment, to take it away from the British or 
German or Belgian competitor, they were given. 

It was possible to make them because heavy ship- 
ments to the Orient usually meant cars loaded to their 
capacity and an uninterrupted long haul. These 
conditions are favourable to a low cost of transportation. 
Then the railroad companies and the steamship com- 
pany adjusted the matter between them. Each bore 
its proportion of the sacrifice. Each helped the other 
to get the business; and all of them helped the country 
by creating it and keeping it for the country. Whatever 
may be true of local traffic or against domestic com- 
petitors, this method is indispensable against the 
outside world if we are to compete for foreign trade. 
For our trade rivals abroad are unhampered. 

But the making of low rates to secure foreign business 


was stopped. It was decided that the portion of a 
through rate which applies to transportation within 
this country that is, the portion covering the distance 
from the point of origin of foreign-bound freight to 
its port of shipment is subject to regulation just 
the same as commerce wholly within the United States. 
The railroad and the steamship could no longer act 
as partners. For the rate to the seaboard must be 
published, so that everybody could know it. It 
could not be raised, under the old law, without ten 
days' notice, or lowered without three. Under the 
Hepburn Act it can neither be raised nor lowered 
without thirty days' notice, except by special order of 
the Interstate Commerce Commission for each case. 
This is equivalent to a prohibition of any change that 
will help to get business. 

A merchant in Hongkong wants a rate on flour 
or cotton or any other commodity. He goes to an 
agent and asks for the best he can get. The agent 
can only reply: "Well, I will cable for one. After 
the cable answer comes back, it will take probably 
thirty days for a new rate to go into effect; and at the 
end of that time, if there is no injunction secured against 
a change in tariffs, I can give you a rate. Until that 
time, our rates as now published must stand." 

Meanwhile the representatives of European steam- 
ship lines are on the ground. They have authority 
to underbid. Their governments are backing them 
up in every possible way. There are tramp ships in 
the harbour, ready to cut rates for a cargo. An 


American line cannot get and keep business under 
such conditions. 

If it meets a low rate, because its competitor is free 
to make a cut and does so, the joint steamship and 
rail lines that do the work between them must dispose 
of the reduction somehow. If the steamship bears 
it all, then it will have to run at a loss and soon go out 
of business. Freight cannot be carried 8,000 miles at 
a comparatively low rate without spreading that rate 
over the whole distance. 

But if a portion of it is allotted to the railroad end, 
then, first, there is great delay before it can become 
effective; and, second, since this reduced rate is pub- 
lished and under supervision, it cannot be raised for 
another thirty days; and, third, if it is lower than the 
rate charged to the same destination on freight con- 
signed to local merchants, the Interstate Commerce 
Commission will be appealed to, and eventually the 
railroad will be ordered to give to local shippers the 
same rate that it has accepted to that point as its share 
of the transportation charge on export business. The 
minimum rate invariably becomes the maximum rate. 
And then the railroad will go out of business. 

So the application of domestic regulation to export 
rates amounts to just this: that one partner or the other 
must work at a continuing loss. Naturally, Oriental 
business does not expand. 

There are secondary causes contributing materially 
to impede or impair the growth of our trade with the 
Orient. The advance in the price of wheat of late 


years has checked exports. The New York Produce 
Exchange reports the average price of No. 2 red winter 
wheat in that market for 1894 as 61.1 cents, and as 96.3 
cents in 1907. It was well above a dollar during 
1909, and sold as high as $1.50 in New York after all 
speculative support of the market had ceased. Where 
it could once be bought for 50 cents a bushel in the 
interior of the State of Washington, it now brings a 
dollar. An advance of 50 per cent., 100 per cent., 
perhaps 150 per cent., in domestic prices cuts sharply 
into the export trade. It is especially effective in those 
markets where, as in China and Japan, earning power 
and purchasing power are limited by a low wage scale 
and a correspondingly forced low cost of subsistence, to 
which the price of the necessaries of life must conform. 
Such a change as has occurred in prices makes wheat 
flour a luxury in many parts of the Orient. 

The American ship-owner is discouraged because 
he cannot earn a reasonable profit. The American 
merchant marine alone among the commercial nations 
of the earth is unsubsidized, yet competes with foreign 
vessels government-paid under one disguise or another. 
So far, for some reason, it has been found impossible 
to give proper Federal encouragement to cargo-carriers 
which the people approve and would like to see 
done without opening the treasury wide to the 
demands of concerns operating swift passenger steamers 
and contributing little or nothing to the growth of 
foreign trade. This the people properly refuse to 
sanction. So the actual carriers of our products 


to the Orient and elsewhere fare like Mother Hub- 
bard's dog. 

Then the American who has put his money into 
vessels to be sailed under the flag of his country and 
wishes to help his enterprise by earning the small 
compensation provided for carrying the United States 
mails can qualify for this only by having his ships 
built by the high-priced labour and out of the high- 
priced materials of this country; officered by Amer- 
ican citizens; and on each departure from the home 
port for the first two years he must prove that one- 
fourth of his crew are American citizens, for the next 
three years it must be one-third, and thereafter at 
least one-half. His competitors may man their vessels 
with cheap Mongolian labour. He must make lower 
rates than they and pay higher wages. 

The sharpness of such competition is felt especially 
in the Asiatic trade. As it affects transportation, so 
it reacts upon the American merchant and the American 
producer. Not without comprehending the situation 
has a recent critic of our policies said: "We may 
build the inter-ocean passage, but unless we turn our 
eyes to the West and reach out for what waits the 
trade seeker there, it will only aid in keeping the 
supremacy of the Pacific in the hands of the foreigners, 
and we will maintain it for the benefit of other nations." 

These impediments to American enterprise are 
reinforced by circumstances unfortunately such as to 
anger and alienate the very people with whom we 
must enlarge our trade if we do business with the 


Orient at all. The Chinese and Japanese are proud, 
ancient and honourable races. They have played 
great parts in history. In many respects they are 
our equals. Chinese residents in the United States 
have suffered personal indignities, and sometimes 
loss of life, until the matter became a national scandal. 

Without regard to the policy of restricting immigra- 
tion, it may be said that the enforcement of existing 
laws on the subject and the suggestion of others have 
been attended by incidents highly offensive to the 
two nations commanding practically the entire Oriental 
trade in which this country can hope to have a con- 
siderable share. Resentment has extended in one 
instance to a practical national boycott for a time 
upon American goods. Everywhere it has produced an- 
tagonism to our people and unwillingness to enlarge any 
sort of relation with them; a condition so unfavourable 
to the growth of commerce that it can be overcome only 
after the lapse of time without repetition of the offence. 

All of these causes combined to produce the results 
shown in the table of trade statistics printed at the 
close of the preceding chapter and exhibiting trade 
decline. An even stronger impression of the same 
fact is gained from a study of the reports of foreign 
commerce by customs districts, contained in the tables 
of the Federal Bureau of Statistics. Our trade with 
the Orient was formerly done largely through the 
ports of Seattle, Tacoma, Portland and San Francisco. 
These cover the two trade routes across the Pacific 
from our Western coast. The first two are included 


in the customs district of Puget Sound. In '1890 the 
Oriental trade through that district was a negligible 
quantity. Our exports from it that year were but 
$3,326,145. In 1908, with transcontinental service 
perfected and rail and ocean facilities increased, 
they had risen to $44,032,767, an increase of 1,223 
per cent. The big jump was from $5,805,193 in 1895 
to $33,788,821 in 1902, before the Russo-Japanese War 
and hence free from its stimulating influence. 

This marks a period in which Puget Sound itself 
changed from a wilderness to a great commercial 
centre. Coming down later, the total exports from 
that district in 1908 are found to be less than they were 
in 1906, and substantially the same as in 1905. There 
has been no growth in these three years. Since our 
carriers have been handicapped, much of the trade 
with the Orient has gone to the steamships of other 
countries, using the Suez route. 

The moral of these figures is reinforced by the record 
in the same time of the import business, measuring our 
purchases from the Orient. The imports into the 
Puget Sound customs district in 1890 were only $305,289, 
while in 1908 they had grown to $22,208,814, an increase 
of 7,174 per cent. The increase in imports in these 
eighteen years is nearly six times as great as the increase 
in exports. At San Francisco, where there has been 
no such sudden local development and no advantage 
of a short ocean route, the figures are in another way 
even more significant. Our total exports from that 
port in 1890 were nearly $37,000,000, and in 1908 only 


$28,000,000; a falling off of about 25 per cent. Our 
total imports through San Francisco were just half 
a million dollars less, in a total of over $48,000,000, in 
1908 than they were in 1890. After eighteen years 
we were only marking time. 

This check or setback occurred at a time when 
enlargement would have been greatest had trade 
been permitted to flow freely. These are the years 
when the Orient has called most liberally upon the 
outside world. The awakening so long foretold is 
here. Japan, since her successful war with Russia, 
has taken her place among the great nations of the 
world. She has organized her industry with the same 
scientific attention to details that she gave to her 
military operations. She has her own shipyards, 
in which her ocean carriers are built. She has her own 
factories, in which almost every manufactured com- 
modity obtained heretofore from Europe or the United 
States is made by her own artisans, working for wages 
that would not be accepted here. She is preparing 
and hoping to dominate the Oriental markets and to 
invade those of the rest of the world. 

Following her example, the Chinese empire has 
rubbed her sleepy eyes, and a similar transformation 
is going on there. The great productive fields of 
Manchuria are like our own in many respects. A 
German expert says that the iron ore deposits of the 
Tayeh district, sixty miles from Hankow, average 
from 58 to 68 per cent, and contain more than 
100,000,000 tons of available ore. Twenty miles 


away there is good coking coal. He thinks that the 
total ore supply of China is not much less than that 
of the United States. The coal supply of North China 
is estimated at 605,000,000,000 tons. 

All these resources are in the possession of a people 
who believe that they should be enjoyed according 
to the law of conservation rather than under the rule 
of waste. All are to be developed under initiative 
not only caught from Japan but learned in these years 
of humiliation and disaster from the nations that have 
scorned China and done with her as they pleased. 

The Chinese are one of the strongest races in the 
world; intelligent, industrious, frugal and brave. 
They have several thousand years of history behind 
them. Both China and Japan have inventive as well 
as imitative ability. Gunpowder and the mariner's 
compass were ancient in China when the white race 
thought it had discovered them. Such men, endowed 
with such resources as are still untouched in the Orient, 
working under a wage scale with which the Western 
world cannot possibly compete, not only do not promise 
to furnish us with a profitable future market for 
manufactures, but they will eventually become com- 
petitors such as we have never had to meet. 

The markets of Europe, our own markets, may, 
not long hence, be full of goods made in the Orient, 
for sale at prices so low that no tariff endurable by our 
own people would keep them out. Then we will begin 
to study the Oriental trade problem from the other end; 
perhaps with a humbler and more disciplined mind. 


For the present we can sell some flour in China and 
Japan, until the Manchurian uplands shall be turned 
into wheat fields. Then China can grow wheat at a 
cost of seventy cents a bushel in silver, which is about 
equal to thirty cents in gold in this country. They 
can do as well in other industries, as soon as their 
resources are developed; and upon this every effort 
is being concentrated. 

We sell them considerable raw cotton, which is 
taken and mixed with the Indian fibre to make a 
smoother and better fabric than they get from 
outside. At the present rate of growth in cotton manu- 
facturing in the Orient, and with wages in China 
at from ten to twenty cents a day, the Far East will 
presently clothe itself and begin to think of entering 
the high-priced markets of the West in its turn. We 
have only wheat, flour, lumber, raw cotton, some 
cotton goods and certain lines of iron manufactures 
and machinery to sell across the Pacific. 

The trade in these, owing to the facts set forth in 
this article, has not been extended or made permanent. 
It was experimental. It is still hand-to-mouth and of 
uncertain future. There was much activity during 
and after the war with Russia, but it has slackened. 
Our export of flour to all the countries of Asia in 
1908 was less than in 1904, and very little greater 
than in 1903. It grew 27 per cent, in seven years. 
The eyes of the Orient are fixed not on the United 
States but on the whole world. They are the eyes 
of men who have suffered, have learned, have become 


conscious of their own powers and propose to make 
the future recompense them for the past. 

Of one other factor in the situation, perhaps as danger- 
ous as any, our country remains strangely unconscious. 
Probably only the few persons actually engaged in at- 
tempts to compete with Oriental industry understand the 
effect of the difference in the exchanges between two 
countries having different monetary standards in value or 
in use or in both. It makes the Orient a sharp competitor. 

As soon as capital is supplied to develop her native 
resources, she will furnish her own raw materials 
for manufacture, buying them in her own markets 
on the silver basis and selling them abroad on the 
gold basis. This will enable her, as long as her own 
people are content to accept these low silver prices 
for material and labour, to cut our prices in two. 
Bar silver sells at about fifty-two cents per ounce 
in New York. On this basis the silver in a dollar 
is worth about forty-five cents. The Chinese manu- 
facturer, who can pay his workmen their low 
wage with silver worth its face, and sell his product 
for gold that is convertible into silver at twice its face, 
has an advantage which we cannot ignore or escape. 
The practical situation is described in a letter pub- 
lished recently in a New York newspaper by Mr. 
Moreton Frewen, an Englishman who has made the 
subject his study for many years. He says: 

'The fact is, and all your consuls and ours in 
the Far East know it, that collapse following collapse 


in Eastern exchange during thirty years has had this 
inevitable and foreseen result; that, stimulated by lower 
and lower exchanges, Asia exports to us more and 
more, and draws her balance in that ' commodity/ silver, 
which is also her only money metal, and with that metal 
builds her new mills and factories to compete furiously 
with ours in our own markets. With a vengeance 
indeed, then, these lowered exchanges have * carried 
Troy into Italy/ Hence we have the problem of the 
unemployed here (Great Britain), which is so pitiful 
this winter. Under the stimulus of cheap silver the 
Orient has awakened to a vigorous industrial life. 
Given a quarter of a century more of exchanges as 
low as to-day, our steel, cotton and leather industries, 
and yours, together with countless small manufactures 
where the labour cost of the article produced bears 
a high proportion to its value, will pass bodily over 
the Pacific from Pittsburgh and Lynn and Lowell 
to Asia. It is easy to see that the day is at hand when 
you will be building your railroads west of the Missouri 
with steel rails rolled in Shansi; that province, nay, 
all China, is the future seat of an industrial competition 
against which no permissible tariff will be effectual." 

Possibly there is exaggeration in this; but it outlines 
with substantial fidelity to fact a future situation which 
scarcely any one in the United States has comprehended 
or is prepared to face. Trade with the Orient is 
changing from an opportunity to another of those 
problems with which we are already well supplied. 

Twenty years ago Japan felt for us something of 
the fine loyalty, the reverence that admires without 
analyzing, which the bright boy feels toward an elder 


brother. At an even later date China regarded us 
as the least uncivilized of the nations that looted her 
ancient capital and despoiled her immemorial temples 
for the decoration of modern drawing rooms. In both 
we might have laid the foundations of a future com- 
mercial connection so deep and sure that they could 
not be disturbed. To-day the favouring moment 
has passed. To-day the instruments by which that 
trade must be done are either broken or impaired, 
while much of the trade itself has gone elsewhere, 
and more is being destroyed by the rise of native indus- 
tries to which both offended race feeling and the 
economic incentive give impetus. 

To-day the United States is in the Orient where it 
is in all the other markets of the earth: face to face 
with a world-wide competition, with an interest 
growing but slowly or actually declining, with a high 
cost of production and with the prospect that its cus- 
tomers are only waiting the time, near at hand, when 
they can become its competitors. The situation is 
more momentous for this than for any other country, 
because control of the Pacific touches our future and 
unites our fortunes with those of the other nations 
that live upon its shores. 

The outlook is not hopeless, but it is not encouraging. 
The country needs to rid itself of the illusion that its 
Oriental trade is to be one of the big elements in its 
future prosperity a conception still lingering gro- 
tesquely in many minds, along with the idea that we 
are powerful competitors of other nations in the world's 


markets for manufactured goods and settle down 
to saving such of it as can be saved. There are still 
possibilities if all the transportation forces, all the 
people, the Federal Government and the laws should 
unite to protect, to encourage this traffic, and to liberate 
it from the bondage against which it has almost ceased 
to struggle. 

The constructive and the destructive epochs in the life 
of this portion of our foreign commerce are as interesting 
and as instructive as many volumes of political history 
or political economy. If there should come a keener 
vision to our people and their leaders, out of mistake 
and failure there might yet, perhaps, be wrought 
something of moment to the future of our nation and 
its destiny on land and sea. 


THE water on the earth's surface, beneath it 
and suspended in the atmosphere above 
it is a very important natural resource. While 
less than 3 per cent, of our food supply is drawn directly 
from river, lake and ocean, the whole of it depends 
upon water in one form or another. Without that, 
no soil can bring forth any form of life. It is the 
universal and indispensable fertilizer. But, like every- 
thing else in the physical world, it follows laws of its 
own. Man must adapt the distribution of water, 
by which the earth's productiveness is regulated, to 
suit his needs. Where there is too much for profitable 
cultivation, he must draw off the surplus; where there 
is too little, he must bring in enough for the support 
of plant and animal life. Upon such control of water 
supply depend the habitability of much of the earth's 
surface and its contribution to the total stock of wealth. 
Irrigation and drainage, therefore, stand in a funda- 
mental relation to national development. The people 
of the United States are interested in both in proportion 
to the extent of its area which can be made useful to 
man only by the drainage ditch or the irrigating canal. 
It is singular that we should have begun systematic- 



ally so late and only after so much persuasion the 
practice of two of the oldest agricultural arts. The 
origin of each is lost in antiquity. Scarcely a mound 
is opened in Syria, disclosing the site of some pre- 
historic city, without exposing remains of conduits 
and other irrigating appliances. In the arid parts of 
the Western hemisphere similar ruins show that irri- 
gation was an applied science on this continent ages 
before the white race occupied it. A large portion of 
the most productive land in England was, within 
historic time, bog, fen and morass. To relieve the 
land of an excess, to supply a deficiency of water have 
been first needs of each people in its turn, according 
to the topography, soil and climate of the country it 

Through several generations the land supply of the 
United States was so ample that every man might 
choose for himself from tracts where nature had done 
for him the work of adjusting water supply to the 
needs of plant life. It is only as the area of public 
land contracts, as population presses, as recourse is 
had to less productive soils, that we begin to resort 
to those other tracts, generally containing some of the 
richest and choicest lands, which are either saturated 
or water-starved beyond the point of profitable culti- 

Of course something has been done from our earliest 
years. There have been pastures reclaimed from 
river overflow, and patches of garden along the water- 
courses of our arid area. The English immigrant 


from the fen country knew enough to dig ditches and 
lay die here. The Hollander sought a soil like that 
from which his native land was made. The Mormons 
founded a communal life dependent upon irrigation. 
Yet it is less than twenty years since advocacy of either 
irrigation or drainage in this country as a general policy 
found understanding or support; and less than ten since 
the campaign of education in the interest of either pro- 
duced an appreciable effect upon the public mind. 

More than twenty years ago the St. Paul, Minne- 
apolis & Manitoba Railroad Company, of which the 
Great Northern is the successor, took up and urged 
the work of drainage in the Northwest, and bore a 
large part of the expense as well. In 1886 a drainage 
convention was called to meet at Crookston, Minnesota, 
in the interest of the Red River Valley lands. The 
railroad proposed to pay half the cost of a survey of 
the valley if the counties interested would pay the rest, 
so that there might be definite information to go upon. 
The plan was agreed to; and when the convention 
met in December of that year, the engineer employed 
by the railroad company made his report, and the 
counties affected asked the Legislature for permission 
to issue bonds for drainage purposes. The 250,000 
acres of land originally granted by Congress for this 
purpose had been diverted to other uses. At first the 
Legislature refused;- but seven years later the state 
made an appropriation, and the railroad gave $25,000 
to aid the work. One of the conditions of this sub- 
scription was that the chief engineer of the railroad 


company should be a member of the Drainage Commis- 
sion until the work should be fairly started. By this 
means the cost of the work was held down to from 
10 to 12 cents per cubic yard, which is lower than the 
work solely under government charge is usually done. 
This was the beginning of state drainage in Minnesota. 
The progress that has been made appears from the 
following facts, summarized from the report, for the 
years 1907-1909, of Mr. Ralph, engineer of the State 
Drainage Commission. The original area of swamp, 
wet and overflowed land in Minnesota was over 
10,000,000 acres, or one-fifth of the total land area 
of the state: 

"Up to 1893 no public drainage work had been done 
in the state and very little drainage work had been 
done by private parties. From the year 1893 to 1900 
some ditches were constructed in different parts of 
the state, principally in the Red River Valley. Since 
the year 1900 drainage work has been carried on 
throughout the state on a much greater scale; each 
succeeding year brought greater activity in this line, 
the years 1907 and 1908 being the banner years in drain- 
age in the history of the state." 

The benefits of the early educational work are now 
being realized, just as they are in irrigation. Under 
the Red River Valley Drainage Commission, $162,412 
were expended between 1893 and 1899. Between 
1901 and 1907 nearly 152 miles of ditches were con- 
structed, at a cost of $127,749. In 1907 and 1908 work 
was carried on upon new state ditches aggregating 189 


miles, the total cost of which is $295,457. Besides 
this, there are 114 miles of cooperative ditches, and the 
whole enterprise is now conducted according to a 
comprehensive state law; with assessments for bene- 
fits, and payments so distributed as to impose the 
lightest burden on the farmer. 

The history of drainage in other states, in so far as 
there is any to have a history, is generally less promising. 
Under the Swamp Land Act of 1850 the Federal Gov- 
ernment ceded to the several states 64,000,000 acres 
of such lands. It was supposed that they would be 
improved, sold and the proceeds used for other internal 
improvements. The bulk of this immensely valuable 
possession has been dissipated. The states have 
parted with the land grants, often for little or no 
consideration, while the main body of the swamps 
and overflowed lands remain just as they were sixty 
years ago. 

The origin of irrigation as a national policy, though 
it is now a commonplace, is the same. Up to a little 
more than twenty years ago the conception of a Federal 
irrigation system did not exist. Individuals had done 
a good deal here and there, small corporations had 
done something, and there was general interest in the 
subject throughout the semi-arid states; but there was 
no plan and no effort commensurate with the needs 
of the West. Nobody at Washington would listen to 
a national irrigation measure. Only a campaign 01 
education could bring results, and again the railroads 
led the way and furnished the means required. 


At first three, and a little later five of the great rail- 
road systems of the West contributed $5,000 a year 
each as a fund to make investigations and publish facts. 
Through lectures, farmers' institutes, the publication 
of articles explaining the need and the opportunity, 
by every legitimate method of creating and strengthen- 
ing public opinion, the work was carried on until 
public sentiment grew strong and politicians began to 
take notice. After five years of hard work among the 
people, Congress took up the subject and passed the 
Reclamation Act of 1902, which is the foundation of 
all the largest undertakings made or likely to be made 
hereafter. No one would any more dare to suggest 
its abandonment now than he would the abolition of 
the post-office. But it is directly the creation of the 
transportation interests of the West. 

Under this law the Government engineers make 
the necessary surveys and prepare plans for dams, 
canals, flumes and ditches. The Government con- 
structs these works, after having secured or assigned 
to each project the necessary water rights. The 
proceeds of all sales of public lands in sixteen states 
and territories, to which the work is confined, with the 
exception of a project in Texas since added, are set 
apart as a fund to pay cost of construction. The 
major portion of the amount obtained from sales within 
any state which is construed to mean 51 per cent. 

- must be expended within that state. The balance 
may be assigned to any project. The cost of the work 
is assessed upon the acreage reclaimed under it. This 


is divided into ten equal instalments. The settler can 
obtain the land, in tracts not exceeding 160 acres, by 
paying fifty cents per acre in cash and assuming the 
deferred payments, which are to be made annually 
for ten years. Title is not complete until all these 
have been met. Thereafter the land and the irri- 
gating works belong to the title-holders; and the sums 
which they have paid in constitute a revolving fund, 
which must be used in additional reclamation work. 
Thus the system, if not interfered with, is self- 
supporting and self-perpetuating until every acre of 
land that can be benefited by irrigation shall have 
been redeemed, occupied and cultivated. It is one of 
the most beneficent works ever carried out by any 
government for its people. The cost of the perpetual 
water right so far has averaged from $20 to $30 per 
acre. Following the rule that public enterprises are 
more costly than private, this work costs too much. 
Where water could be put on land for $10 to $12 per 
acre, the cost to the Government is much greater. 
The average amount of water supplied annually is 
enough to cover the land four feet deep. Only one-half 
of this amount actually reaches the crops, the remainder 
unavoidably escaping in the process of being conducted 
to growing plants and trees. Canada has followed a 
slightly different method. In southern Alberta is 
a tract of 3,000,000 acres reserved from settlement. 
Irrigation works are completed, the land is sold out- 
right to settlers at from $15 to $25 an acre, and then 
there is a perpetual water rate of fifty cents an acre 


annually. About 1,000,000 acres were thus opened 
to settlement in a single year. 

Progress under our system has been very rapid, 
for two reasons. Most of the country dealt with had 
already been surveyed, and the engineers were ready 
with their plans and estimates. The money also 
was ready, the fund having risen to over $23,000,000 
by the time field work began. In 1902, when the 
bill became a law, about $200,000,000 had been invested 
or sunk in irrigation projects by individuals and cor- 
porations, and some 10,000,000 acres in the United 
States were already fertilized in this way. Probably 
as much more is now being reclaimed in various 
Western states by private enterprise. 

Under the national law, twenty-six projects have 
been approved by the Secretary of the Interior, 
and construction has begun. Over $33,000,000 were 
expended in the first five years. The service employs 
16,000 men and spends about a million and a quarter 
each month. Its completed canals now extend for 
nearly 2,000 miles. Some of the work is of stupendous 
magnitude. To reclaim 90,000 acres of land in South 
Dakota, the largest earth dam in the world is being 
built. A solid wall of masonry 310 feet high is rising 
to impound the waters of the Shoshone River in a 
reservoir covering ten square miles, by which 100,000 
acres will be irrigated. The total area to be redeemed 
by projects now under way is about 1,600,000 acres. 
Other projects found feasible by the engineers would 
extend the reclaimed area to more than three and 


three-quarter millions acres, at an estimated cost of 
$160,000,000. The receipts and expenditures of the 
entire service to December 31, 1911, are estimated in 
the reclamation service report at $58,000,000 each. 

Most of the land reclaimed is of extraordinary fer- 
tility when supplied with sufficient moisture. By 
intensive cultivation, with fruits and vegetables, one 
acre can be made to support a family. Five acres is 
a competence, and ten acres the limit if devoted to 
fruit farming that one family can take care of 
properly. Fruit growing has become a great industry, 
the desert has acquired an actual value that ranges 
anywhere from $50 to $1,000 or $2,000 an acre, homes 
for millions have been provided, and the literature of 
the country is full of the promise of irrigation. There 
are hundreds of thousands of people to-day in cities and 
workshops who have invested in these lands, are getting 
them ready for occupancy and look forward to a future 
spent in wholesome and congenial labour on the soil. 

It is most important in carrying forward government 
projects like this, which always cost more than the 
same work would as a private enterprise and under 
personal supervision, that the character and cost of 
the work should be carefully ascertained beforehand, 
so that it may not exceed the estimates. Otherwise 
the settler is crippled and discouraged. Settlers in 
Montana under the Lower Yellowstone project, who 
were to pay $30 an acre for ten years according to the 
estimates, are now asked, on account of the excess 
cost of the work over what was expected, to pay $42.50. 


Probably the estimates originally were not wholly 
unreasonable, but the high prices that were paid for 
labour and materials greatly increased the actual levy 
on the soil. This should always be avoided. 

If no such record of progress for drainage can be 
made out, it is because public opinion has not been 
educated to the same extent. It has been shown that 
much has been accomplished in Minnesota, because 
the railroad early saw the need and value of the work. 
Yet it is only a trifle in comparison with what might 
and ought to be done. There are still plenty of farmers 
who complain that their lands are too flat, although 
there is several times more slope than suffices to carry 
off the water of the upper Mississippi; who object 
to the slightest tax that is not spent on their own acres; 
who, after the ditches are in place, plow their lands 
across the drainage rather than with it, thus holding 
the water on the land. And one may see, on the finest 
lands in the world, bountiful crops turn from green to 
yellow in a week or two. The expenditure of from 
two to five dollars an acre would save these crops. 
It would make land now worth at most some $50 an 
acre worth from $100 to $150. Corporations have 
done something in Florida and elsewhere. The gov- 
ernment of the state has made a beginning of reclaim- 
ing the Everglades. As we shall see presently, the 
possiblities of reclamation by drainage in this country 
as a whole are not inferior to those of reclamation by 
irrigation. The territory so gained is muck, enriched 
by the deposits of ages. The tracts usually lie in settled 


communities, within easy reach of roads and markets. 
But public education has not proceeded as far in one 
direction as in the other. 

The country cannot know even yet what is the limit 
of additions to national wealth which may be made 
by the reclamation of lands now unproducing because 
of either deficiency or excess of water supply. Our 
ideas about the practical value of drainage are the 
less definite of the two, because they have been less 
enlightened by discussion. Mr. Guy Elliott Mitchell, 
of the United States Geological Survey, has made the 
completest summary of possibilities in an exhaustive 
article published in the Review of Reviews in 1908. 
While the ordinary estimate of the area of American 
swamps is from 70,000,000 to 80,000,000 acres, he 
thinks that a larger total, probably well upward of 
100,000,000 acres, is indicated by the Government's 
investigations. Florida has between 23,000,000 and 
24,000,000 acres of wet land, and there are fully 
20,000,000 acres in the Mississippi Valley subject to 
overflow. Mr. Mitchell says: 

" There are seventeen Eastern states every one of 
which has more than 1,000,000 acres of swamps, 
and there are twelve additional Eastern states having 
between 250,000 and 1,000,000 acres each, and there 
are six more Eastern states with an aggregate area of 
nearly 7,500,000 acres of swamps." 

In the eastern and central parts of the country 
most farms have a few acres of low ground which no 


attempt has been made to redeem, because there is 
acreage enough without them. It seems reasonable 
to believe that the aggregate of wet land available for 
cultivation by proper drainage will be far above the 
largest figure yet named. Professor Shaler says that 
in Great Britain and Ireland fully one-fifth of the most 
fertile agricultural lands has been reclaimed by drain- 
age, and that one-twentieth of the now tillable land 
in Europe was inundated and unfit for agriculture in 
the eighth century. 

This affords us a measure of what may be accom- 
plished in the future on this continent. In Minnesota 
alone some idea of what may be done has been given, 
though our knowledge of the statistical facts is still 
slender. The Federal Government has made surveys 
of the ceded Chippewa lands, in the northern part of 
the state, now held in trust. There are 2,500,000 acres 
of them, and the cost of reclamation with ditches 
running to each 160 acres is put at $2.75 an acre. 
Surveys of another tract in northern Minnesota show 
that 400,000 acres might be reclaimed by drainage 
for less than $5 per acre, and might afterward be worth 
from $50 to $100 an acre. There are such possibilities 
everywhere. The engineering problems are simple 
and the cost is light. Irrigation should cost from $12 
to $60 per acre. Drainage probably averages less 
than $10, and sometimes is as low as $2 or $3. 

For the future of drainage work, unless we wait 
upon the slow progress of public enlightenment and 
the reluctance of people to tax themselves now for a 


future benefit, reliance must be placed upon some 
such measure as has been already proposed to Congress 
but not yet adopted. This is in principle a duplica- 
tion of the reclamation law, and proposes to do for 
drainage what was done for irrigation. Moneys 
received from the sale of public lands in a number of 
Southern and Western states, not included in the 
Reclamation Act of 1902, and all containing much 
swamp or overflowed lands, would be set aside as a 
drainage fund. This would be used to dig ditches, 
establish pumping stations and complete drainage 
works exactly as is done in irrigation work; the cost 
to be repaid in the same way, in ten annual instalments, 
to go into a revolving fund for similar employment 
elsewhere. There can be no more objection to one 
policy than to the other. The public benefit will be 
equal. There should be concentrated effort to procure 
such legislation. For while there are immense areas 
of arid land which can never be irrigated, there is 
scarcely an acre of swamp land anywhere that cannot 
be drained or diked until fit for cultivation. 

If the possibilities of irrigation are more vague they are 
no less alluring. The value and importance of the work 
are being more and more realized. There are about 
100,000,000 acres irrigated in the whole world. Egypt 
has 5,000,000 irrigated acres, supporting 7,000,000 
people. Some of the greatest engineering feats of 
modern times have been performed in the construction 
of great dams on the Nile, by which the natural overflow 
and subsidence of the river may be aided or imitated 


by man. English engineers are now beginning irriga- 
tion works under government authority in Mesopotamia, 
to restore the lost beauty of what was once the garden 
of the world. Some irrigated lands in Egypt support 
900 persons to the square mile, in Italy over 800, in 
India over 1,200. It has been estimated that there 
are 60,000,000 acres of irrigable land in the United 
States. Probably, with experience and improved 
methods, that amount will be increased. Great spaces 
of what was once called the Great American Desert 
have been converted into rich farm lands, and more 
will be found available than we now imagine. In some 
places where Government reclamation work has been 
done, it is reported that the water supply is appropri- 
ated for less land than it ought to cover. The Govern- 
ment engineers are unwilling to listen to representations 
made by outsiders familiar with the facts. Not all 
the land among the mountains nor all the alkali plains 
can be redeemed; but the total subject to experiment 
is so great, the raw material so abundant, that the 
fulness of its promise will be realized only after many 

The need and the value of additions to the tillable 
area are emphasized by the rapid increase of population 
and the decrease of the public domain. The latter 
has almost disappeared. The question of homes for 
future generations is of paramount importance. At 
the close of the Civil War the frontier was about the 
Des Moines Valley, in Iowa. Kansas was still mostly 
unsettled. Now the country has been developed to the 


Pacific Coast. States and cities that are marvels of 
growth have come into being. Some authorities have 
declared that by the end of six years there will be no 
tillable public lands in the United States, outside of 
the reclamation area. But this view is modified 
by the great possibilities of new and better methods 
of farming. What is generally but improperly called 
the "dry farming" method has rendered highly pro- 
ductive very large areas heretofore regarded as of little 
or uncertain value to production. In the Judith Basin, 
in Montana, there have been harvested 57 bushels 
of wheat per acre, weighing 60 pounds to the bushel. 
The following table gives the area of public lands 
passing into private ownership during the past ten 

...... 9,090,623 

19 ...... iS^QM 6 * 

i9 01 ...... i5>453>449 

i92 ..... , i9,37 2 >3 8 5 

1903 ...... 22,650,928 

1904 ...... 16,258,892 

1905 ...... 16,979,075 

i9 6 ...... i9>345>444 

1907 ...... 20,866,592 

1908 ...... 18,938,886 

Over 170,000,000 acres have thus been appropri- 
ated in a decade, and the quantity and quality of the 
remainder fall together. In spite of this wholesale 
appropriation, or rather because it has been so largely 


a game of grab and speculation instead of honest 
home-making, the density of population in the whole 
country from the Missouri River to the Pacific was, 
at the last census, scarcely three to the square mile. 
When population reaches a density of 250 to the square 
mile, which was that of New Jersey in 1900 and was 
much exceeded by both Massachusetts and Rhode Island, 
each 100,000 square miles redeemed by irrigation will 
make room for 25,000,000 additional people. This 
is on the reasonable basis of one family to each ten 
acres, and four persons to each family. Such relief 
from the pressure of population will be appreciated 
more as we approach the middle of the century and 
the total of 200,000,000 people for the United States. 
By that time the two forms of land reclamation will 
have become national benefactions; and the work 
that we are prosecuting along those lines to-day will 
be the foundation of future prosperity and a safe- 
guard against future dangers. 

In addition to its obvious value as a home provider, 
the reclamation of swamp and desert lands affects 
powerfully the general character of agriculture, the 
level of comfort, the life of the community and the 
health and intellectual activity of the people. In 
these respects it rises in dignity and value as a national 
resource higher than by its additions to superficial 
area and gross wealth. These recovered lands are 
the country of the small farm. Their value can be 
brought out only by more or less intensive tillage; by 
the growing of fruits, vegetables and other market 


produce. The moral of the small farm, with its 
greater percentage of profits, is thus kept continually 
before the people. The farm containing from a 
quarter of a section (160 acres) up, carelessly culti- 
vated, requiring incessant work and yielding a 
meagre return per acre, cannot hold its own against 
the snug comfort and ample rewards of the little 

Where irrigation prevails, there is certainty, abund- 
ance and variety of products. Water being procur- 
able at will, unfavourable seasons do not exist and 
the growth of plant life is at the command of the 
cultivator. Abundance follows, because reclaimed 
lands are richer than any others in the elements 
that promote growth. These have not been ex- 
hausted by cultivation or leached away by rains 
and floods. The marvellous yields obtained from 
irrigated lands at first seemed beyond credence; 
they are such a familiar story now that illustrations 
are unnecessary. In Utah the Mormons have created 
wealth estimated at more than half a billion dollars 
from a wilderness of alkali and sage brush. As soon 
as water is put on this formerly worthless land it rises in 
value to a figure several times what the best non-irrigated 
land would bring; prices justified by the profits from 
special crops of early fruits, melons, berries or vege- 
tables to supply high-priced markets. Towns like 
North Yakima and Wenatchee and scores of others 
double their population in a few years and exhibit 
an increase of wealth matched only by the growth of 


centres in newly developed mining regions. But while 
the wealth of mines must finally become extinct, the 
market town of a district intensively cultivated becomes 
a larger and more important business centre year after 

With the more intelligent and remunerative system 
of farm cultivation come incidental advantages at least 
as important as the additions to wealth. In a previous 
chapter the social superiority of the community of small 
farms has been mentioned. Cooperation and associa- 
tive enterprise flourish. Schools, churches, telephones, 
rural mail delivery, comforts of all sorts abound. Life 
is no longer isolation. Practically every worthy attrac- 
tion that draws people to the cities is added to the 
country life. Health is improved. The desert is 
always wholesome, but the draining of swamps reduces 
disease. The reclaimed country is one continuous 
village, with houses set in more than usually spacious 
grounds, with neighbours everywhere and no incentive 
for the upbuilding of centres of concentrated population, 
destructive as well as creative of high civilization. 
Material comfort, health and social and intellectual 
activity are attendants of the reclamation system on 
a large scale. The economic values are no more evi- 
dent or pronounced than the sociological and the ethical. 

The country must come to look upon both drainage 
and irrigation as parts of a national conservation plan. 
No movement of our time is more suggestive or encour- 
aging than that which shows a people at last awaking 
to a sense of national economic responsibility. For 


our own sake, in the higher as well as the lower sense, 
for our future preservation as well as for our moral 
respectability, we must consider our resources as a 
whole, and plan the disposition and conservation of 
them with reference to one another. For they fit into, 
supplement and depend upon one another as nicely 
as do the different forces of nature herself. Irrigation, 
drainage, flood restraint, forestry and waterway im- 
provement are so closely tied together that any 
intelligent prosecution of one of them draws all the 
others after it. That we have legislated about them 
singly and piecemeal is one of our costliest national 
mistakes. There should be a scientific national plan, 
prepared by the best available skill after thorough 
investigation, in which each of these interests should 
be so cared for as to promote all the others and draw 
help from them in turn. They are all intimately 
related to the greatest of all economic purposes, the 
conservation of the soil and its productive power. 
Our governing bodies will not become fully worthy 
of the name until they shall have assigned to each of 
these agencies its place in the coordinating scheme 
of national development. 

How backward we are still is shown by the fact that 
no urgency of public opinion and no pressure of common 
honesty has yet succeeded in taking the preliminary 
step a reasonable reform of the land laws. The 
agencies of justice are employed in discovering and 
punishing land thieves whose crimes were invited by 
legislation apparently framed for their especial profit. 


The repeal or amendment of many of our land laws 
and the stringent enforcement of the provisions 
of the Homestead Act are necessary to honest 
dealing with the land question. Speculators and 
land-grabbers prevent this, while occasional Congress- 
men and Senators are smirched and disgraced by 
participating in land frauds. We have enlarged the 
unit of public land for Alaska, in order to tempt dis- 
honesty there. We have made it 160 acres for land 
reclaimed at great expense, although a large family 
could scarcely cultivate twenty acres of this land 
as it should be. Perhaps economy must be substituted 
for the extravagance now too prevalent in every depart- 
ment of government before we can hope to see it 
supreme in land reclamation and distribution. But 
this plain business conception must be restored before 
the country can hope either to realize upon or retain 
its most valuable resources. 

Meantime irrigation is proceeding under the auto- 
matic action of the law providing the necessary funds. 
Had this work been done by the plan now urged for 
'waterways, by direct appropriations and bond issues, 
we should have spent at least $500,000,000 of money 
that did not belong to us upon it. It will be completed 
by the proceeds of land sales aggregating probably 
not much more than from $50,000,000 to $75,000,000 
altogether. The gain, not in some theoretical way, 
but in actual added resources, may be measured by 
a glance at the productive power of the irrigated and 
irrigable country. 


The fourteen states and two territories named in 
the Reclamation Act produced in 1908 as follows: 


Wheat . . . 330,250,000 $291,112,000 50 

Corn . . . 553,564,000 290,546,000 21 

Barley . . . 89,058,000 42,241,000 53 

Oats . . . 208,091,000 92,731,000 26 

Potatoes . . 51,782,000 34,503,000 15 

Hay (tons) . 16,532,000 120,571,000 23 

Yet these states and territories contain a land 
area of i>552,737 square miles, out of a total 
of 2,974,159 in the whole United States, or 52 per 
cent, of our continental area exclusive of Alaska. 
They were inhabited in 1900 by only 7,747,192 people, 
a beggarly 10 per cent, of the entire population. Lib- 
eral estimates for our growth since that raise this only 
to about I2j per cent. It is reasonable to assume 
that, through irrigation, the 52 per cent, of our Western 
area will in the future carry more nearly 52 per cent, 
of our population than only 12. 

The possible additions to natural wealth and capa- 
city for support by drainage are not as easily calculated, 
because with few exceptions, like the Dismal Swamp 
and the Everglades, they exist in scattered blocks of 
land rather than in a connected territory. But enough 
has been said to show that, as a resource, they will 
probably be not inferior in total to the irrigable country. 
Most progress in the increase of wealth in our time 
has been through improvement in processes, economies 
in handling, utilization of low values, creation of by- 


products by the slow and patient methods that aim 
at eliminating waste. It will probably be found that 
the areas which may be either reclaimed or made to pro- 
duce several times as much as they do to-day, and to bear 
values several times as great, by a scientific readjust- 
ment of their water supply in one direction or the other, 
have been as much underestimated as the mining engi- 
neer of a generation ago undervalued the ores that he re- 
jected because of their low percentage or the admixture 
of elements which we have since learned to get rid of. 
We can scarcely guess to-day at the total gains to accrue 
from regulation of water supply after it shall have fur- 
nished its last addition to tillable area and productive 
power; after it shall have completed its work for the ex- 
pansion of the country and the betterment of its people. 
To the transportation agencies, especially those 
operating in the West, the subject is of great importance. 
They were quick to realize this and act upon it. As 
they were pioneers in the campaign of education for 
both irrigation and drainage, so they are as vitally 
interested as ever, and are promoting both by every 
means in their power. The railroad satisfied merely 
to move an already existing tonnage will soon be 
distanced. It can grow only as the communities 
along its lines multiply and prosper. With every addi- 
tion to them, every increase in the volume of traffic, 
come gains for the two parties now understood by 
honest men to be not rivals but partners; namely, an 
increased revenue for the carrier and a lowered rate 
for the shipper. Ordinary sagacity and intelligent 


self-interest prompt the railroad to support sincerely 
and continuously projects that involve an increase of 
population within its territory measured by millions, 
and of a tonnage movement measured by billions 
of ton mileage. If its original motive was selfish, it 
was the kind of selfishness out of which civilization 
has been developed; since all progress shows that a 
man can benefit himself truly and permanently only 
by accomplishment that benefits his fellows also. 

It has been made clear how close is the relation be- 
tween reclamation work and all the other forms of conser- 
vation and development of resources. To put water on 
arid land is to fertilize it as really as to add phosphates or 
to enrich it by fallowing and rotation of crops. To take 
away the excess is simply the reverse of the same coin. 
Both are mighty agents in the work that we have before 
us; which, if we aim to be better than the brutes, must 
be to preserve and provide for the generations to come. 

It is a new world that is to be called into existence; and 
in this there is perfect community of interest, because 
in it we all have, through our children, through hopes 
that run into the distant future, through our desire for 
national prosperity and perpetuity, a mighty stake. It 
is worth our while to work in the present toward the 
large ends that these labours presuppose, though directly 
they may profit little those who contribute most; be- 
cause of a worthy national spirit and because of that 
satisfaction which comes to all who have helped to 
open the door to opportunity and to an outlook upon 
a broader, happier and more bountiful human life. 



THE life of civilized communities is as de- 
pendent upon the carriage of commodities as 
physical life is upon gravitation. This move- 
ment takes place over ordinary roads, over railroads 
and over rivers, lakes and canals. These constitute 
the circulatory system of any country. The improve- 
ment of the common highway has yet to take its proper 
place in public thought and care. Railway transpor- 
tation will be considered in chapters to follow. The 
value of the waterway and the limits of its usefulness, 
as well as the means by which the country may utilize 
it up to that limit, have been the subject of much 
public discussion. This should be clarified and 
reduced to statement of plain fact. For all the facts 
may be ascertained easily if one wishes to know them. 
For ages the development of every country was 
determined by its rivers, coasts and harbours. The 
improvement of these, to fit the needs of commerce, 
was a national care. "Internal improvements," in 
the early history of the United States, meant just this. 
The coming of the railroad pushed the waterway, 
for a time, into the background. This was true in 
the United States to a degree unparalleled anywhere 



else in the world, because nowhere else has the rail- 
way met that need so fully; nowhere else did it begin 
with the early life of communities and keep pace with 
or anticipate their growth; nowhere else has railroad 
expansion been marked by such admirable system 
and the cost of service been reduced so rapidly and so 
far. The improvement of rivers and harbours went 
on, it is true, upon a great scale; but these, after all, 
were secondary agencies of commerce. Most of the 
history of the development of the United States is 
written in the history of its railroad systems. 

Recent events have directed attention anew to the 
importance of extending and improving our waterways. 
Two main reasons appear. One is the check put upon 
railroad expansion by legislation that passes the bound- 
ary of proper regulation and represses legitimate enter- 
prise. The other is the enormous pressure of traffic 
upon terminal facilities and trunk lines that cannot 
be duplicated except at prohibitive cost. The business 
of the country, under normal conditions, will have 
need of all its carriers. The public, however, has 
been led by visionaries and appropriation hunters to 
suppose that waterway improvement and extension 
will solve every problem and make everybody rich 
and happy. Only after a disillusioning experience 
and much waste of public money will they learn the 
truth. It is of the highest importance therefore, that 
the situation should be understood, and that a true 
and permanent theory of the function of waterways 
and the steps which the people ought to take to 


utilize them more fully should be generally known 
and accepted. 

It will clear the ground for this if a few widely 
prevalent errors are disposed of first. The foremost 
and most persistent of these is the idea that the railroad 
and the waterway are antagonistic, and that either 
can gain business only at the expense of the other. It 
has actually been proposed in Congress to forbid 
railroads to reduce their rates when competing with 
water routes. But there is nowhere any evidence of 
an unfriendly disposition on the part of railways 
toward water transportation. There is no rivalry for 
an exclusive service. Each is fitted for a particular 
office in transportation. In any well-ordered national 
system they will supplement each other. For reasons 
just stated, the railroad has developed more rapidly 
in this country, from economic causes solely, as is 
proved by results wherever the two come into actual 
competition. Some of the facts about the division 
of transportation work in America between river and 
rail are interesting. 

The trunk lines between Chicago and New York 
were built and have created their enormous traffic 
subject from the beginning to the competition of the 
Erie Canal. It had occupied the field before there 
was a mile of railroad anywhere in the United States. 
St. Louis has become one of the important centres 
of the country's railroad business, while all the time 
the Mississippi was at her service. On the Ohio 
is some of the cheapest water carriage in the country. 


Its cost in 1905 is reported as .76 of one mill per 
ton per mile for moving freight by river from Pitts- 
burgh to Louisville, and .67 of one mill from Louis- 
ville to New Orleans; but these rates, though frequently 
quoted, have not been verified. It is also said that 
rates much lower than these have been made on 
barge tows during the season. But the quotation 
of a single rate is meaningless unless we know whether 
it covers the cost of the return trip, its due share of 
the whole season's necessary outlay and of all the 
expenses that must be met by any carrier forming 
part of the transportation system of the country and 
assuming to regulate its charges. Here, however, 
is a cheap and convenient route by which the coal 
of Pennsylvania and Ohio may be moved to the 
factories of the lower river. Coal can be shipped 
profitably by water if anything can. What is the fact ? 

Of a total of 8,743,047 tons of coal received at St. 
Louis in 1907, just 155,470 tons were carried by boat. 
A large part of this came from local mines. Every 
pound of the 1,155,645 tons shipped out went by rail. 
And of all the commodities received at and shipped 
from that city, amounting in 1907 to nearly 48,000,000 
tons, only 368,075 tons, or less than .79 of i per cent., 
were brought in or sent out by water. 

The chairman of the freight committee of the New 
Orleans Board of Trade says in his official report: 

"It is a well-known fact that the steamboats plying 
out of this port find a number of prominent railroad 


competitive points on their route. It is also, we regret 
to say, a positive fact that our boats are accorded but 
little business shipping out of this city to said points. 
Practically the only outbound freights that are shipped 
on the boats are such as cannot be delivered by a 

Galveston, with no such waterway from the interior 
at her doors, exported 14,172,071 bushels of wheat in 
1907 as against 5,496,935 for New Orleans. Up to 
this time the river has been unable to compete with 
the railroad. In the year 1855-1856 the domestic 
exports from New Orleans amounted to $80,000,000 
and were practically all carried by water. Not in 
recent times has the commerce of the lower river 
reached $3,000,000, although the total imports and 
exports of New Orleans in 1907 were over $200,000,000. 
These figures expose the absurdity of the theory that the 
railroad need feel either jealousy or fear of the waterway. 

The two systems of carriage have developed together 
effectively in many European countries; and errors 
are constantly made in our current discussion by draw- 
ing an analogy that fails in essential particulars. In 
such countries conditions differ from those in the 
United States in two all-important respects: first, 
their railroad freight rates are so much higher than 
ours that a cheaper mode of transportation must be 
provided or certain kinds of freight could not be 
carried at all; second, necessary facilities for water 
shipments, such as modern barges, commodious and 
convenient wharves and loading and unloading appli- 


ances are provided so abundantly that water carriage 
loses the element of uncertainty and delay which has 
helped to reduce it to a negligible quantity on most 
American rivers. 

A recent consular report to our State Department 
concludes with these fervid periods: 

"The United States could, perhaps, reach no more 
practical result nor one of possibly greater advantage 
to its enormous producing interests than by turning 
its attention in the direction of the improvement and 
development of its waterways. The mileage of the 
inland waterways of Germany, if possessed by the 
United States in proportion to our area as compared 
to that of Germany, would be equivalent in linear 
measurement to 40 parallel waterways east and west 
from the Atlantic to the Pacific, and 20 parallel water- 
ways north and south from Canada to the Gulf; and 
that would mean a network of canals for a state like 
Ohio, say, running east and west and north and south, 
which would be something like 40 miles apart from 
boundary to boundary in all four directions. With 
this in view, the importance of Germany's waterways 
may be properly appreciated by the American student 
of this subject." 

This half-baked stuff is a type of much that has 
been written and spoken in this country on waterway 
improvement. The waterway is to be the saviour of 
the producer, as against the railroad. Yet most 
German railroads are state-owned; and waterways 
are resorted to there as an escape from the intolerable 
burden of the rates the railroads impose. 


There is more freight traffic on the Rhine than 
on any other stream in Europe. Many of the rivers 
of that continent carry tons where ours carry pounds. 
Why ? Dr. George G. Tunell, in a recent report 
to the Chicago Harbour Commission, says: 

"The average freight rate per ton per mile on the 
United Prussian and Hessian State railroads during 
1906 was 13.41 mills, while the average rate in the 
United States was but 7.48 mills. Unlike the railroads 
of Europe, those of this country compete vigorously 
with water carriers for even the lowest kinds of traffic. 
The average rate on coal and coke on the United 
Prussian and Hessian State Railways in 1906 was 
9.79 mills; on the Chesapeake & Ohio Railway it was 
but 3.27 mills." 

And not only are European freight rates from two 
to four times as great as ours, but even her boasted 
canals are also more expensive highways. The follow- 
ing table is compiled by Dr. Tunell from official 


Buffalo to N. Y. by canal . 500 $.0400 $1.33 

Buffalo to N. Y. by rail . 410 .0427 1.42 
Antwerp to Strasburg by the 

Rhine 501 .0475 1.58 

Antwerp to Strasburg by 

French canals . . . 504 .0693 2.31 

One begins to perceive through these figures that 
the relative fortunes of the two transportation agencies 
in the United States in the past are not without an 


economic explanation. The American waterway, 
under conditions existing here, and relying upon rate 
competition to maintain itself against the railroad, 
has not been a success. Its charge has not been enough 
lower to offset the advantages of speed and certainty in 
delivery. The Erie canal, once of great practical value 
as a carrier, has become of late years as a competitor 
with the railroads comparatively unimportant. In 
June, 1908, New York City received 1,690,075 bushels 
of grain by the all-rail route, 1,133,900 bushels 
by lake and rail and 725,400 bushels by canal. 
For the six months ending June 30, 1908, the all- 
rail route carried to New York 32,489,837 bushels 
of grain and flour, the lake and rail 8,069,466 
bushels and the canal but 1,469,100 bushels. Yet 
the rates between New York and Chicago on which 
east and west business has been thus divided were 
recently as follows: 


First class $.75 $.62 $.42 

Second class 65 .54 .36 

Third class 50 .41 .29 

Fourth class 35 .30 .23 

Fifth class 30 .25 .21 

Sixth class 25 .21 .18 

It will be worth the reader's while to compare these 
rates with those just given on German railroads and 
waterways, reducing both to a mileage basis. He 
should also appreciate the concise and accurate con- 


elusion of this phase of the subject as stated by 
Dr. Tunell: 

"The all-rail rates are higher than the lake-and- 
rail and the lake-and-canal only as 4O-cent coffee may 
be higher than 30- or 2O-cent coffee, or as rates and 
fares over a standard rail line may be higher than 
those over a differential rail line. And it is equally 
true, historically speaking, that rail rates have been as 
influential in bringing down water rates as the latter 
have been in reducing the former." 

It has been made clear that the main reason for the 
comparative neglect to utilize waterways in this country 
is the more desirable service, in kind or cost or both, 
rendered by the railroads. A secondary reason is the 
failure of cities and business associations to provide 
the accessories without which river transportation 
is commercially unavailable. There is constant 
demand in the United States for deeper channels, 
big dams, every form of improvement that, at the cost 
of millions paid by taxation, will help to provide water 
of navigable depth. But the landing places, con- 
nections, dock facilities and the boats in service on our 
streams are just about what they were fifty years ago. 
For stating the case in a nutshell it would be hard to 
improve upon the following, printed in a Cincinnati 
publication, which advocated at the same time the 
most liberal expenditure on our waterways: 

"When I asked a river man, a large shipper, in one 
of the towns depending wholly on the river, what 


he thought of the nine-foot stage, he said, ' I wish the 
Ohio River would dry up; then we would get the railroad 
in here and our troubles would be over/ This man 
is a large shipper of baled hay, cattle and produce for 
the Cincinnati markets, just the sort of freight which 
ought to go by river. 

"The river has 'got on his nerves/ His 'troubles' 
are an indictment of the river as a highway of com- 
merce, and they sum up pretty well the whole problem 
from the standpoint of the river town. 

' ' For shipping hay, hogs, cattle, etc./ said he, 'the 
railroad is better than the river. Take the shipment 
of a drove of hogs: we drive them down to the river from 
the yards to await the arrival of the boat, the drivers 
yelling and the hogs squealing; the bank is steep, 
oftentimes muddy; there are no yards or conveniences 
because of the rise and fall of the water; the arrival 
of the boat is uncertain; if it is on time it comes about 
dusk, and there is the trouble of getting the animals 
on board. Then there is the night on the boat dock 
scenes repeated in Cincinnati then through the 
crowded streets to the city stockyards. Compare with 
the railroad: you order a stock car to your yard, load 
at your leisure; the car is run direct to the stockyards 
in the city, and you have no trouble at all. The present 
boat line is a monopoly and charges what it pleases, 
so there is but little difference in the freight rate/" 

The proof that the railroad and the waterway are 
complementary rather than mutually destructive in 
every well-organized traffic movement is even more 
decisive when we turn from the waterways that are com- 
paratively little used to one that is a marvellous success 
as a carrier. The total arrivals and clearances of ships 


at all ports on the Great Lakes in 1907 were 147,904, 
aggregating only a little less than 200,000,000 net tons. 
The volume of commerce grows steadily, when not 
halted by general business depression. The total 
freight passed through the "Soo" canals in 1907 was 
over 58,000,000 tons. Over 61,000,000 tons passed 
the Detroit River in the nine months ending Novem- 
ber, 1909. The ore alone carried by the lake route in 
1907 amounted to over 900 pounds for every man, wo- 
man and child in the United States. The tonnage 
passing through the Suez Canal in the same year was 
but 14,728,434. The tonnage of vessels passing 
through the Sault Ste. Marie Canal was 17,619,933 
in 1897 and 44,087,974 in 1907. Twenty years ago 
Duluth was a little town with only a promising local 
trade. To-day it is one of the great shipping ports 
of the world, with unlimited possibilities of expansion. 
For 1905 the total tonnage of New York harbour, 
foreign and coastwise, was 30,314,062. For 1906 
Chicago's tonnage was 15,638,051. That of Liverpool 
and Birkenhead in 1906 was 16,147,856, and London's 
in 1905 was 25,867,485. The tonnage of Duluth- 
Superior in 1907 was 34,786,705, with a valuation of 
$287,529,705. But while the phenomenal growth of 
lake business and the reduction in the rate, which was 
22.36 cents per bushel by lake and canal from Chicago 
to New York in 1867, and 6.64 cents in 1907, have taken 
place practically within the last twenty-five years, 
the railroads running west and northwest from Buffalo 
and Chicago have not suffered. On the contrary, 


traffic in this territory has increased with amazing 
rapidity; and the capacity of these railroads is taxed to 
handle business that cannot or will not use other routes. 
In the chapters devoted to railroad transportation 
will be presented statistics showing how far the 
growth of traffic in the United States has exceeded 
the growth of facilities for carrying it. The 
transportation deficit will presently become so great, 
when business is free to grow unhindered by repressive 
legislation, that no amount of capital available for 
new construction or for extensions and improvements 
could make it good. It will also be shown there 
that one of the most serious causes of congestion - 
the inadequacy of terminal facilities in the large 
centres cannot be removed by any expenditure. The 
necessary ground cannot be secured. This problem 
of terminals at every busy port affects the waterway 
as well as the railway. Ships must be loaded and 
unloaded promptly or paid for delay, since fixed 
expenses continue to accrue. The growth and the 
cheapness of traffic on the Great Lakes are due in no 
small degree to the effectiveness of terminal machinery 
at their head. Duluth and Superior handled more 
tons in 1907 than any other seaport, and it was all 
carried into or taken out of the port by a few railways. 
These cities have less than 300 miles of terminal track, 
as against 2,000 miles at Buffalo. But at Duluth- 
Superior a cargo of 12,000 tons of ore can be loaded 
in an hour and a half. So much better are terminal 
facilities at the head of the lakes than elsewhere that 


they handle in seven and a half months of open naviga- 
tion more business than any other port in the world 
handles in twelve, and do it more satisfactorily. 

The traffic of the country needs, whenever normal 
conditions prevail, all the assistance that waterways 
can give. Their services are immediately important 
in two ways: first, to afford a larger number of dis- 
tributing points, so that the piling up of freight in 
terminals may be relieved; second, to transport the 
bulkier and cheaper commodities, that can as well 
take a slower and cheaper route, over the main trunk 
lines of transportation in the country, thus lightening 
the burden that must, with industrial development, 
become too heavy for the railroads to bear unaided. 
How severe this pressure is may best be seen by looking 
quantitatively at the producing power of the Middle 
West; rich, busy and so situated that both what it 
sells and what it buys must be carried over long dis- 
tances. The twelve states of Ohio, Indiana, Illinois, 
Michigan, Wisconsin, Minnesota, North Dakota, South 
Dakota, Iowa, Kansas, Nebraska and Missouri contain 
more than half the farm-property value of the United 
States. They have about one-fourth of the total area 
of the country and one-third of its population. In 
agriculture they are as important as all the rest of the 
country combined. In 1908 these twelve states raised 
456,521,000 bushels of wheat, or 69 per cent, of the 
total yield; 1,644,649,000 bushels of corn, or 61.6 per 
cent, of the entire crop; 608,237,000 bushels of oats, 
or 75.5 per cent, of the whole; and 144,289,000 bushels 


of rye and barley, or 72.6 per cent, of the total crop. 
Their production of butter, cheese, potatoes, hay, etc., 
is about one-half that of the whole country. They raise 
practically all its flax, and the aggregate of their farm 
products is not far from half that of the United States. 

From these fertile lands comes the surplus breadstuff 
product that constitutes the bulk of the real wealth 
of the country. They are now only partially occupied 
and carelessly tilled. The time is coming when their 
product must be made twice or fourfold what it is to-day. 
Even omitting their mineral wealth and their manufac- 
tured product, the latter being about one-third that of 
the country, and not considering their domestic com- 
merce, which alone would tax their transportation 
facilities, the getting of these food supplies out of the 
central basin and to their ultimate markets is essential 
to our economic welfare. 

Not all the commerce of the interior seeks a Southern 
seaport. Half of Ohio, much of Michigan, and parts 
of Wisconsin and the Northwest are more directly 
tributary to the Great Lakes. But this subtraction 
will be more than made good by river business origina- 
ting in states south of the twelve named. The cotton 
crop is to the South what the grain crop is to the North. 
In 1908, the states of Arkansas, Louisiana, Mississippi, 
Tennessee, Missouri, Texas and Oklahoma produced 
8,016,914 bales. Oklahoma alone grew 15,625,000 
bushels of wheat in 1908. Nearly all this product 
is exported, and this adds more tonnage to the lower 
basin than is diverted to the lakes in the upper. 


In one respect, however, the traffic load promises 
to grow lighter. The great reduction in the volume 
of our exports of agricultural products will soon leave 
little of this business, to which the waterway is well 
adapted, for it to carry. In New Orleans and Galves- 
ton grain elevators have been standing empty for some 
years because of this decline in our exports of bread- 
stuffs. As stated in the chapter on "Farm Methods/' 
the average annual export of domestic wheat and 
flour for the five years 1905-1909 was 113,146,896 
bushels; for the five years 1880-1884, twenty-five years 
earlier, it was 149,572,716 bushels. The falling off 
is nearly 25 per cent. Within a very few years our 
increase of population, with continual lowering of 
soil fertility, must make our entire product insufficient 
for home consumption and seed. This decrease, which 
will affect more or less seriously all the items of our 
present export of articles of food, both vegetable and 
animal, will tend to lessen somewhat the strain upon 
both land and water transportation agencies. 

Nature indicates that the commerce of the Middle 
West with the rest of the world should be carried in part 
by the Mississippi River. In the last forty years we 
have spent between $200,000,000 and $250,000,000 
on it and its more important tributaries without mak- 
ing progress toward that end. Instead, the trend of 
traffic is away from the river. In 1888 there were 
3,323 boats and barges, carrying 597,955 tons of freight, 
besides lumber and logs, arriving at St. Louis. In 
1907 there were 1,330, carrying 289,575 tons. The 


departures in 1888 numbered 2,076, with 510,1 15 tons; 
in 1907 they were 931, with 78,500 tons. On many of 
the rivers and canals of the country where conditions 
ought to be most favourable, there is a similar steady 
decline of water-borne freight. And the movement 
to revive water traffic does not state clearly either its 
end or the means by which this may be reached. 

That end, as we have seen, is to perform two 
extremely valuable transportation services: to carry 
heavy and bulky articles, where no haste in delivery 
is required, and a low rate must be made to move them; 
and to share with the railroads the burden of moving 
a volume of domestic commerce that will soon tax all 
resources. In the long run, transportation adopts 
the line of least resistance. The rivers mark the direc- 
tion. Just as the drainage of the Central West is 
gathered into the Mississippi and passes by it to the 
Gulf, so that portion of its commerce which is made 
up of articles of large bulk and weight will move natur- 
ally in this direction when the outlet is made practically 
available. The congestion of a steadily increasing 
traffic will be relieved by turning a share of the business 
over to the towboat and the barge. Here lies the solu- 
tion of an important part of the transportation problem. 

Our waterways will not resume their proper place 
ajid office by following the theory that, if we only spend 
money enough, we can somehow obtain results. We 
need a systematic and scientific plan. We have spent 
enormous sums in the past without appreciable results 
except on our ocean and lake harbours. We must work 


to a definite end; and our method must be prescribed 
by the past experience of our own and other countries. 
In the first place, waterways that are to play an 
important part in traffic must be deep waterways. 
That point cannot be emphasized too strongly. A 
vessel that carries only 1,000 tons cannot compete 
with a box car. With a steamer carrying 10,000 tons 
you have it beaten. This is the key to the only growth 
of water-borne traffic that has taken place in our 
interior commerce. Twenty years ago the largest 
carriers on the lakes that could pass through the old 
"Soo" canal, with its fourteen-foot locks, were of about 
3,000 tons. The canal was deepened to twenty-one 
feet, and now an ordinary load is 10,000 to 12,000 
tons. This explains the wonderful growth of lake 
commerce already referred to. The difference in 
cost between the operation of a boat of 3,000 and one 
of 12,000 tons is only so much as will cover the employ- 
ment of two extra firemen, two more deck hands 
and the purchase of about ten tons of coal additional 
per day in all, some $28. At this slight extra 
expense the carrying power is quadrupled. Hence 
the phenomenal expansion of lake commerce within 
the last twenty years, while this change in its carrying 
machinery took place. The fact establishes the sound 
law of all waterway development. It has been well 
stated by Dr. Ramsdell: 

"The larger the ship, the greater its carrying capacity 
and the cheaper its rates of freight. Vessels drawing 
twenty-eight to thirty-two feet and carrying 8,000 to 


12,000 tons can and do carry freight very much cheaper 
than those drawing twenty-two to twenty- four feet and 
carrying 3,000 to 4,000 tons. The ocean rates to-day 
on the immense steamers plying at our great harbours, 
which have been deepened to thirty and more feet, 
are from one-third to one-fourth the rates of twenty- 
five years ago, when steamers drew only twenty-two 
or twenty-three feet; and this saving of 300 to 400 per 
cent, in transportation charges is directly due to the 
improvement of their harbours/' 

These results, however, have been obtained not 
by the mere spending of money, but by spending it in 
the right way. We must spend it in the right way 
on our navigable streams and our canals. The starting 
point for a system of deep waterways in this country 
is a working plan. The nation has wasted its resources 
and obtained little return, so far as our rivers are 
concerned, because its methods have been aimless. 
The amount and the assignment of appropriations 
have been and still are determined too much by political 
influence and local greed, regardless of the merits of 
the work in question. Thus labour and resources 
are dissipated in schemes of little value, or actually 
thrown away. More than thirty years ago Congress 
adopted a plan for slackwater navigation on the Ohio 
River, and at the rate the work has proceeded it may 
be completed in 150 years. We have not a deep river 
channel in the United States, made such by Federal 
improvements, except where jetties have scoured out 
passes to the sea. 


Waterways should be created as other great physical 
enterprises are. The first railroads did not begin 
in the heart of the country and run vaguely anywhere. 
They were lines between important centres and terminal 
points; and extensions, branches and feeders were 
added as needed. Waterway improvements should 
be similarly planned. Locate the trunk lines first. 
Open a way to the sea by the biggest, freest, most 
available outlet. Push the work as nature directs, 
from the seacoast up the rivers. All this should be 
part of a general scheme of coordinated improvement 
and conservation of resources; including reservoirs 
on the headwaters of the main stream and as many 
of its tributaries as may be necessary to prevent 
floods and maintain a deep channel in the dry season, 
river canalization or canal construction parallel to 
its course, and the maintenance of a sufficient and 
permanent channel for boats of the largest size during 
the season of navigation. 

The lower Mississippi, from New Orleans to St. 
Louis, has precedence, and a deep water connection 
with the Great Lakes should come next. It is as 
important that the order of these improvements be 
not reversed as it is that you do not set the water 
running in your bathroom before you have provided 
an escape pipe with a free outlet. As far up as Vicks- 
burg there is now a channel equal to any demand that 
commerce might put upon it. The cost of dredging 
a canal down the Mississippi bottoms, putting in the 
twenty-five to thirty necessary locks and obtaining 


rights of way, might possibly amount to $75,000,000. 
If we can spend hundreds of millions on the Panama 
Canal, we can afford to construct one from St. Louis 
to the Gulf, which would be incomparably more 
valuable to commerce. It has been estimated that 
this would give a fourteen-foot channel in two or 
three years, and reduce the cost of maintaining unob- 
structed navigation in the lower river from $10,000,000 
a year to less than $1,500,000. A twenty-foot channel 
would be worth three times as much. Just as the 
vessel load increased from 3,000 to 10,000 or 12,000 
tons when the "Soo" canal was deepened, so will the 
carrying capacity of the river channel be multiplied 
by increasing the depth. 

For east-and-west business we have already the 
Great Lakes; which must be supplemented by a true 
deep waterway along the line of the Erie canal, instead of 
the commercially valueless ditch into which the people of 
New York State are now dumping another $100,000,000, 
principally for the benefit of politicians and contractors. 

Everywhere else, in Europe, even in South America, 
they are building their canals and dredging their 
rivers for channels from twenty to thirty feet deep. 
Canada, always in advance of us in canal construction, 
has learned the lesson from her disappointment with 
the Welland system, although that has fourteen feet. 
She is now planning the Georgian Bay Canal, to be 
made twenty-one feet deep throughout. Should that 
be finished, Liverpool would be little more than a 
hundred miles nearer to New York than to the Canadian 


shore of Lake Huron. These two main water highways, 
stretching toward the four points of the compass, 
should for a time command all the energy and all the 
resources we have to give to waterway improvement. 
Subsidiary projects should take later place according 
to their relative importance, unless there is enough 
local interest and financial support to push them without 
calling on the Federal government for aid. 

The fatal objection to most of the waterway pro- 
grammes is that they aim to cover the whole country 
at once; cater to the greed of every section and every 
state by projecting a cobweb of nine-foot, six-foot 
and even four-foot channels, whose construction is 
supposed to go forward simultaneously, and most of 
which would be valueless to commerce if they were 
finished and presented to the public free of cost. 
Instead of this, the work must be done methodically, 
in the order of the value of its parts. It will not be 
thus systematized until it is placed in charge of a central 
commission, created and invested by Federal statute 
with the authority to select, plan, contract for and con- 
struct waterway improvements. It must be permitted 
to use annual appropriations according to its judgment, 
and transform our system into a scientific method, 
before we can rescue our waterway interests from the 
vicious circle of log-rolling appropriations. 

The question how and to what extent money shall 
be provided touches the vital nerve centre of any large 
enterprise and the danger point of this. Some enthusi- 
asts urge that the national credit be pledged in 


practically unlimited amounts in order that we may 
try to do everything instantly, before we are actually 
ready to do anything. It is a reckless, foolish and 
criminal policy. One bill before Congress recently 
proposed to appropriate at once $50,000,000 for the 
work, and authorized the President, whenever the 
funds in hand fell below $20,000,000, to sell bonds 
enough to raise them to $50,000,000 again, and to 
repeat this process indefinitely. Others have proposed 
lump appropriations ranging from $500,000,000 to 
$1,000,000,000, the money to be obtained by bond issues 
to that amount; claiming that the value of the work justi- 
fies borrowing and that it will repay expenditures many 
times over. Against such wild schemes for blood-letting 
of the public credit every good citizen should protest. 

The country has actually been toured semi-officially 
by a person arguing, in favour of the $500,000,000 bond 
issue, that it would save the people $238,000,000 a year 
in freight charges, and therefore practically pay back 
the cost of the whole work in two years. He does not 
say why, if this were true, the same people who received 
their money back in two years should also borrow it on 
fifty-year bonds. This is but one drop from the ocean 
of turgid nonsense spoken and written on the cash value 
of waterway transportation and waterway improve- 
ment; some of it the product of deliberate demagogy, 
but more of it fathered by political hysteria and sheer 
inability either to perceive facts or to reason from them. 

On the alleged saving in freight rates we have not 
only the ample statistics already cited, but the testimony 


of an official expert. Mr. Ray S. Reid, Waterways 
Commissioner of Wisconsin, investigated personally 
both the waterways and the charges of Europe as well 
as of this country and reported the results to the 
legislature of his state. He found the larger use of 
rivers in Europe made possible not by spending large 
sums upon them, but by devising craft to use them as 
they are. Here are his most important conclusions, 
stated in the words of his official report: 

"If modern methods of operation were put in use, on 
the Mississippi River and its tributaries, such rivers 
can be made the most economical means of transporta- 
tion, in their present condition, that can be found within 
the borders of the United States. 

"Every railroad is entitled to a rate that will pay a 
reasonable profit, and every dollar of profit taken 
from a railroad by water transportation must necessarily 
be added to the tonnage actually carried by it, and it 
follows that every ton of freight that is carried by 
water transportation at a cost exceeding that of trans- 
portation by rail is a loss to the public. 

" If there is a canal anywhere on which the pro rata 
cost per ton per mile, on all tonnage carried over it, 
would not be greater than the amount it would cost 
an American railroad to carry it, if 4 per cent, interest 
on the cost of construction and the cost of operating 
and maintaining the canal were distributed over its 


tonnage, I would like to know where it is, that so I 
could visit it and see how it is done." 

Only as people are willing to give up their money 
for anything is their judgment of its worth and necessity 


to be trusted. Only then can economy and honesty 
in expenditure be expected. Much of the extravagance 
and corruption often accompanying the construction 
of local public works springs from the carelessness 
incident to the spending of borrowed money. If the 
people had spent each year only what they provided 
by taxation, they would have had as many necessary 
improvements for a fraction of what these have cost in 
bonds. And freedom from heavy interest charges 
would enable them now to spend at an increased rate. 
The unwise pledging of public credit cuts in both 
directions. If we once embark on this policy in national 
affairs, where the connection between the appro- 
priating power and the tax collector is loose and 
little realized, we shall scarcely stop short of national 

Look at it merely as a business proposition. The 
interest on $1,000,000,000 at 4 per cent., if such a sum 
could be obtained by the issue of bonds at that rate 
or at any rate, is $40,000,000 a year. The largest 
demand made by the waterway movement as a whole 
has been an annual appropriation of $50,000,000; 
and this is probably more than could be spent judi- 
ciously. There is thus only the trifling difference of 
$10,000,000 a year in actual cost to the public between 
the policy of cash and that of credit; but by the latter 
the annual contribution must continue until the enor- 
mous principal of the debt is paid, while the former 
buys something, pays for it, enjoys it and has money 
in pocket for the next year's labour and the next step 


forward. The country is perfectly able to provide 
each year all the funds that can be spent wisely on its 
waterways in that year and bring in value received. 
This is its only security against the waste of public 
resources common to all liberal drafts upon the public 

The future of the waterway as a factor in trans- 
portation can be injured only by some such folly as 
the proposed issue of bonds for its improvement. The 
essentials for developing its highest possibilities are 
few and simple. For the sake of clearness it may be 
well to repeat them: 

First: A permanent commission, authorized to 
expend appropriations in its discretion upon national 
waterways in the order of their importance. 

Second: A comprehensive plan, including the classi- 
fication of rivers and canal routes according to relative 
value, and also including such reservoir and slack- 
water work as may be required to carry each project 
to success. This plan in its essentials to be adopted 
by the commission at the outset and adhered to without 
interference by Congress or any department. 

Third: Insistence upon the development of trunk 
lines first, and upon a depth that will make these real 
carriers of commerce, able to aid the railroads in 
their task by transporting bulky freight economically 
and with reasonable expedition. 

Fourth: A liberal standing appropriation annually 
for the commission's work until its plans shall have 
been carried out over the whole country; and a refusal 


to pledge the nation's credit for a single dollar of this, 
which is properly our work. 

To favour and to labour for such a system, even 
though it should demand local self-sacrifice and the 
postponement of local desire, is the duty of all of us 
as good citizens and honest business men. Railroad 
and waterway, needing each other and both needed by 
the people, may work together for the good of the 
people. The transportation problem, which grows 
and complicates with our growth and with every arti- 
ficial restriction imposed upon it, may be solved by 
intelligent anticipation. A deep-waterway movement 
that shall set for itself this standard will command the 
support of the people by commending itself to their 
judgment instead of their greed. It will get rid of 
local log-rolling and all the brood of those who are 
"for the old flag and an appropriation." It will com- 
plete and make adequate to future needs the whole 
system of transportation by land and water in the 
United States. It will place those who succeed in 
popularizing and establishing it among the most 
far-sighted statesmen and benefactors of their time. 




THE land highway as a common carrier is coeval 
with the waterway. In the dawn of civiliza- 
tion the trail gave way to the beaten path, 
and that to the caravan route. As man emerged into 
history he became a road-maker; the better the road, 
the more advanced his development. For centuries 
the interchange of products and the intermingling of 
individuals from different countries were accomplished, 
everywhere save on a fringe of seacoast and narrow 
strips along the rivers, over land ways adapted to 
beasts of burden and, later, to rude vehicles. Then 
came the toll pike, the post road, the railroad; this 
last being still only three-quarters of a century old. 
I have said elsewhere that when the History of 
Transportation shall be written it will be equivalent 
to a History of Civilization. These chapters con- 
template no such ambitious attempt. The existing 
literature on land transportation would fill a library 
of respectable size. Moreover, the subject is so inex- 
tricably interwoven with our whole common life that it 
has entered to a considerable extent into the formation 



of all the chapters in this volume. Those preceding 
this have shown its intimate and organic connection 
with Agriculture, Commerce, Consolidation, the 
Development of the Country, the Conservation and 
Utilization of its Resources and its relation to the 
rest of the world. It is proposed here only to set 
down certain general principles governing transporta- 
tion over railroads; to rectify some mistakes and to 
point out some certain results of policies proposed or 
now on trial. 

It is important to realize from the outset how unique 
has been the service of the railroad in the United States. 
When the steam engine and the wheeled car travelling 
on iron rails were first utilized for the carriage of 
persons and goods, they were used in Europe as sub- 
stitutes for already existing means of communication 
of inferior value. They took the place of the pack 
animal, the stage coach, the goods van, that crowded 
all the highways between populous centres. It was 
merely the substitution of a more efficient for an 
inferior agency, in a society already developed and a 
country comparatively occupied. In the United States, 
on the other hand, the railroad was a pathfinder and 
pioneer. When it appeared here, the only thickly 
settled territory lay along the Atlantic and Gulf coasts 
and the rivers flowing to them. The first long line 
of railroad was built in this country to improve com- 
munication between the sea and the interior beyond 
the Alleghanies. From that day to this the railroad 
has outrun the settler and beckoned him on; has 


opened up new territory, brought in population, created 
new industries and new wealth. It has served not as 
a mere connecting link between communities, but as 
a creative energy to bring them into existence. From 
this characteristic of the railroad system of this country 
have arisen differences of function affecting almost 
every relation of the railroad to the people. 

Our railroad mileage per square mile of area is 
about 46 per cent, greater than that of Europe, while 
Europe's population per mile of railroad is nearly 
six times ours. The main service of the railroad 
almost everywhere in Europe has been to increase 
the business of old centres of population and commerce; 
in the United States its most valuable work has been 
to help populate virgin soil and connect new com- 
munities with their markets. Similarly there is an 
immense difference, as will be shown, between cost 
of construction and capitalization here and abroad; 
a difference in density of traffic, in classifications, in 
rates, in most details of practical operation. 

The first railroads in the United States had to be 
built hastily and cheaply. The settler himself did 
not go without a house until he could have one with 
frescoes on the walls and a gas plant in the basement; 
and the railroad provided just enough facilities to take 
the settler in and carry his products out at the smallest 
expense. In no other way would it have been possible 
to open so quickly the enormous interior spaces of 
this country and fill them with cities, towns and vil- 
lages. While the railways of the United States may 


have mistakes to answer for, they have created the 
most effective, useful and by far the cheapest system 
of land transportation in the world. This has 
been accomplished with very little legislative aid, 
and against an immense volume of opposition and 
interference growing out of ignorance and misunder- 
standing. It is not an exaggeration to say that in the 
past history of this country the railway, next after 
the Christian religion and the public school, has been 
the largest single contributing factor to the welfare 
and happiness of the people. 

Of course some of the earlier railroad building was 
badly done or overdone. Speculative ventures on one 
side and legislative reprisals on the other brought 
disaster. Even the railroads of the second period, 
from 1870 on, were sometimes ill-advised affairs, 
physically or financially considered. Between 1880 
and 1895 there was a heavy crop of receiverships. 
This paved the way for the new era. It gave the death- 
blow to feeble or discreditable methods of finance. 
It welded scattered railroads into continuous lines of 
communication, definitely organized and financially 
strong. A large proportion of the railroads of the 
United States were reorganized and many were rebuilt. 

The railroads of the country have been to a consid- 
erable extent and are still being further segregated 
into great systems and groups. This is a physical 
and geographical necessity; and would have been 
completed before this but for the vast extent of the 
country to be occupied and the failure of legislators 


to perceive its inevitableness and its beneficence. 
Resources are no longer wasted on the construction 
of unnecessary lines whose maintenance constitutes 
a continuing charge upon the people. One manage- 
ment instead of many implies greater convenience for 
the public, with increased efficiency and decreased 
cost of operation for the carrier. Up to the limit of 
practical efficiency, set by the nature of the country 
and the peculiarities of traffic in its different sections, 
this combination and segregation will proceed. 

The final product must be a number of strong 
systems, each competent to give to the people of the 
territory served by it the best service, and all competing 
against one another for the better development of the 
areas served by them respectively and the sale of their 
products in the common market. Each railroad 
system can prosper only by increasing its traffic. It 
can do this only by increasing the number of its cus- 
tomers and the volume of their business. This urges 
it to consult the business interest not only of the towns 
and manufacturing or commercial concerns along its 
lines, but also of those who occupy the land. The 
building up of industries requires the building up of 
markets for their products. Railroad and producer 
stand together for the prosperity of the interest they 
have in common. In this competition between the 
producer and the railway in one locality, acting together, 
with the producer and the railway in another locality, 
acting together, resides the only effective final com- 
petition of railroads that for markets. Public con- 


trol of rates prevents extortion by the carrier. Thus 
the outlines of a definite railway evolution begin to 

The immense transportation machine of the United 
States has grown in less than eighty years to a total 
of more than 230,000 miles, or about 40 per cent, of 
the mileage of the whole world. It has bound 
ocean to ocean and prevented the severance of East 
from West. It has conquered the empire of the Middle 
West and the Northwest, turned the desert into fertile 
farms, been co-partner with individual industry in 
the creation of our stupendous agricultural interest 
and made possible the extension of our manufactures 
and the growth of our markets. Its rise has been at 
every point the index of all our boasted national devel- 

How about the work cut out for it in the meantime ? 
Our population is increasing at the rate of from 
2,000,000 to 2,250,000 a year. The total value of 
farm products doubled in the thirty years from 1870 
to 1900. It doubled again between 1900 and 1907. 
In ten years the product of petroleum more than 
doubled, that of pig iron increased 150 per cent, and 
the total value of manufactured products rose from 
$9,372,437,283 in 1890 to $13,004,400,143 in 1900. By 
1905 it had grown to $14,802,147,087. Every item of 
material growth means more work for the railway; 
since almost everything that ministers to human 
wants, except such products of the farm as are consumed 
on the farm, must be moved for a longer or a shorter 


distance. A comparison between the increase of rail- 
road mileage and the actual growth of work done 
by the railroads for the ten years between 1897 and 
1907 will show how far the former had lagged behind. 
The decade ending with 1907 is chosen because that 
is the last year when business was expanding free 
from the check of excesses in legislation hostile to 
capital, and also the latest for which the complete 
statistical report of the Interstate Commerce Com- 
mission is available. The disparity between the 
national transportation agency and the work it has 
to do appears in the following table: 


1897 190? Increase ^J^ 

Mileage Operated 188,844 2 3*>,949 48,105 25.5 

Passenger Mileage 12,256,939,647 27,718,554,030 15,461,614,383 126 

Freight Ton Mileage 95,139,022,225 236,601,390,103 141,462,367,878 148 

No. Locomotives 35*9^6 55*3^8 19,402 54 

No. Passenger Cars 33*626 43>973 Io >347 31 
No. Freight Cars 

(Not including General 

Service) i,i>73 I >99 1 >557 769*817 63 
Passenger Miles per 

Passenger Locomotive 1,223,614 2,163,146 93953 2 77 
Ton Miles per Freight 

Locomotive 4,664,135 7>375>5 8 5 *7"4S O 5 8 

Total Capitalization $10,635,008,074 $16,082,146,683 $5,447,138,609 51 


Revenue per Passenger Decrease per ct. 

per Mile 2.022 cents 2.014 cents .008 cents .039 
Revenue per Ton 

per Mile .798 ' -759 -039 " 4.88 

The severe blow to business administered by hostile 
agitation followed by legislation against capital, both 
in the nation and the states, which culminated in 
1907, relieved for a time the situation disclosed by 


these figures. Instead of raising transportation facili- 
ties to the level of the burden laid on them, the business 
of the country was overthrown by a public campaign 
of malice and misrepresentation. Everybody suffered; 
and, for a time, perhaps, a lesson was learned. But 
the country is still growing; under wise policies that 
growth will increase, and the railroad must meet the 
ensuing new demands. More miles of track, more 
equipment, above all more terminals, must be provided. 
It would be practically impossible to construct another 
trunk line from Chicago to the seaboard at any cost 
on which interest could be paid without charging the 
business more than it could bear. Since terminal 
areas are physically limited and in many places prac- 
tically exhausted, it might be an impossibility to build 
such a line at any price. With all the assistance that 
waterways can give, the country will nevertheless soon 
be face to face with an emergency calling for energy 
and judgment as well as a public confidence so fully 
restored as to bring out the immense amount of capi- 
tal required to make even a slight improvement upon 
the situation. 

There are three principal reasons why this emergency 
has not already become more pressing. First, the 
existing railroad systems had not been fully utilized. 
Many anticipated, as has been seen, the development 
and even in some cases the settlement of the country. 
Their business capacity remained for years in excess 
of the needs of the territory they served. Second, 
the inadequacy of transportation facilities was met 


as far as practicable by the increased capacity of rail- 
road equipment. Third, there has been a wonderful 
increase of efficiency in operation. The last, by 
increasing actual service from the same plant, has been 
equivalent to the duplication of all the railroad 
trackage in the United States within the last fifteen 
or twenty years. 

A few figures will illustrate what has happened. 
Take 1900 and 1907 for comparison; the latter year 
representing the climax of business prosperity. The 
Great Northern and the Northern Pacific Railway 
systems together serve a large territory that may be 
considered fairly representative in growth. They were 
all the time adding to facilities more rapidly than systems 
in older parts of the country are expected to do. Yet 
business gained upon them. The combined operated 
mileage of the two systems increased 20.6 per cent, 
between 1900 and 1907. The combined passenger 
mileage increased 162 per cent.; and the revenue 
freight mileage, which represents the commercial 
service rendered by the railroad to the public, increased 
132 per cent. These significant figures measure the 
relative pace of construction and traffic growth. Yet 
the number of miles in proportion to the population 
served was much higher than for older portions of the 
country. As far as increase of equipment could help 
to solve the problem thus created, much was done. 
The number of freight cars on the Great Northern 
system increased 19,291 between 1901 and 1909, or 
84 per cent.; and their aggregate tonnage capacity 


861,696, or 140 per cent. On the Northern Pacific 
the increase in number in the same time was 14,794, 
or 55 per cent.; and in tonnage, 708,293, or 102 per 

The increase of equipment for the whole country, 
as appears from the table already given, was 55 per 
cent, in the number of locomotives and 63 per cent, 
in the number of freight cars for the ten years 1897- 
1907. But this would not take care of a growth of 
126 per cent, in passenger and 148 per cent, in freight 
mileage. Each cog in the big railroad machine, each 
mile of track, each engine and each car must be made 
to do more work. Increased efficiency in operation 
alone could lift the immense weight so suddenly thrown 
upon the national transportation system. This, also, 
was forthcoming. The number of miles travelled per 
annum by each freight locomotive on the average 
increased 58 per cent, in these ten years, and by pas- 
senger locomotives 77 per cent. Engines of much 
higher power were substituted for the old-fashioned 
type, so that a bigger load could be hauled. The 
average car capacity was correspondingly enlarged. 
On the Great Northern this was about 27 tons in 1901 
and 35 tons in 1909; on the Northern Pacific the increase 
in the same time was from 26 tons to nearly 34. In 
these years the total tonnage capacity that is, of 
all the freight cars on both these systems increased 
by 1,569,989, or 120 per cent. 

Operating officials laboured incessantly to expedite 
traffic by speedier methods of loading and unloading, 


by more careful segregation of through and local 
freight and by such a car distribution as would reduce 
the haul of empties to the minimum. As rapidly as 
the necessary funds could be obtained, tracks were 
straightened and shortened, curves and grades reduced 
or eliminated. Heavy rails were substituted for light, 
to carry without risk heavier train loads at a higher 
speed. On both the mechanical and the operating 
sides of railway work, intelligence matched itself 
against the growing demands of traffic; bridging the 
deficit between volume of business and facilities for 
its discharge by ever greater advances in efficiency. 
The general measure of increased efficiency is 
density of traffic. This is ascertained by dividing the 
total number of tons of freight carried one mile by the 
number of miles of track operated. It measures the 
actual business use of the rails, which is the unit of 
efficient work. The density of traffic on all the rail- 
ways of the United States was 519,079 tons for 1897 
and 1,052,119 tons for 1907. This means that the 
practical working value of each mile of track was 
doubled during these ten years. Of course, density 
of traffic is greatly affected by density of population; 
by the concentration of business. For example, a 
four-track road between Philadelphia and New York 
would have very dense traffic. Each mile of track 
carries, under such circumstances, almost the maximum 
volume that it can accommodate. But the increase of 
density has been as marked in the West and Northwest 
as anywhere. The two northern transcontinental 


systems, for the most part single-track roads, traversing 
a sparsely settled country and encountering great physi- 
cal obstacles, have raised their combined density of 
traffic to 963,782 in 1909, or almost equal to the average 
for the whole country; while there are certain divisions 
on each whose traffic density is several times as great 
as the general average, and greater than that of some 
lines operating in the more thickly settled parts of the 

There is, of course, a limit to density of traffic on any 
line, just as there is a limit to every sort of efficiency. 
The load that the modern engine places on the rails is 
all that they will bear. The steel is carrying all that 
such material can carry without danger. A mile of 
track can do no more than its maximum. What shall 
be done when this point has been reached ? Some 
systems have very nearly arrived at it; and, in general, 
any future increase of load will be carried far less easily 
than that of the past. Especially is this true of terminal 
facilities. The public, on its side, has done very little 
toward providing increased facilities for loading and 
unloading. In some cases it actually lessens them by 
unnecessary and time-consuming restrictions. Conges- 
tion rules in most of the great traffic centres of the 
country. The national transportation system as com- 
pared with the work assigned to it will grow more and 
more inadequate. What is to be done ? 

One material improvement remains possible. The 
service performed by each freight car is now absurdly 
low, and legislation tends to make it still lower. The 


average run of all freight cars, the country over, is 
less than 25 miles per day. The balance of the time 
is spent on switching tracks, in yards and waiting the 
convenience of shippers and consignees. This is a 
great item of waste in railroad operation. The big loss 
comes from delay in loading and unloading. 

Every hour that one of its cars is held costs a railroad 
company money. The tying up of its equipment costs 
the public as well as the company both money and 
service. If one man has the use of a car for a longer 
time than he is entitled, somebody else, in the busy 
season, must be deprived of it when he needs it. But 
many states have passed laws to intensify the difficulty 
and evil of the situation. In Connecticut, for instance, 
no railroad company is permitted to claim or collect 
any sum from any shipper or consignee for delay in 
loading or unloading, "for any period of less than 
four consecutive days, Sundays and legal holidays 
excluded." Legislation of this sort is equivalent to 
the destruction of a considerable percentage of the 
car equipment of the country; and until the country 
is educated beyond the possibility of it, the railroads 
can make little progress toward raising the beggarly 
car service of 25 miles per day that prevents existing 
facilities, even when ample, from doing the work 
required of them. No other business is limited in 
the use of its equipment to two or three hours out of 
the twenty-four. 

In the important traffic centres the area available for 
terminal uses is limited. The cost of securing addi- 


tional ground, if it can be had at all, is often prohibitive. 
Yet the public is deprived of the use of terminals pro- 
vided, by such regulations as the one cited above. 
Suppose that there are 5,000 cars to be delivered 
daily in the state of Connecticut; a reasonable estimate, 
considering the number of its populous trade centres 
and the factories grouped in its towns. A four days' 
accumulation would gather 20,000 cars in the railroad 
yards. If each car averages 40 feet in length, it would 
require 151 miles of track merely to hold the standing 
cars. In many of the states new and more onerous 
demurrage regulations are continually being brought 
forward; the net effect of them all being to increase 
the cost of service and to shrink by just so much the 
possible daily average of car use and the working value 
of terminals that the country ought to expand by every 
means in its power. 

In addition to what may be done by increasing 
efficiency and by calling water routes to its aid, the 
railroad transportation system of the United States 
must, of course, enlarge and improve its plant to cor- 
respond more nearly to the great volume of additional 
annual traffic. This can be done only by inducing 
capital in sufficient amount to engage in the enterprise. 
Several billion dollars are required to level up the 
transportation system of the country to the height 
of present needs. But capital will make the venture 
only when and where it expects a reasonable return. 
The conditions prevailing before the business depression 
of 1907 are now returning in aggravated shape. Term- 


inals will be congested, the number of cars will be short 
of the demand, commerce and production will be 
blighted by uncertainty and delay in transportation, 
and the impossibility of guaranteeing prompt delivery 
under contracts. 

This can be cured only by great and continuous 
investment in railway construction; by enlarging 
terminals, double-tracking and four-tracking lines 
most heavily used, building new feeders from territory 
recently developed and in all ways keeping open the 
channels through which courses the life-blood of the 
nation. It can be done only by a hearty coalition 
between the public and the stored capital of the world; 
all available means being none too great for the purpose. 
It will be done only when there is the same inducement 
to such investment, the same assurance of fair treat- 
ment under the law and the same freedom to earn an 
honest or even a generous return upon capital that 
is granted in every other form of enterprise. Here 
as elsewhere in national development capital must be 
dealt with, because it is indispensable. Here, as on 
all the other highways of progress, the greed or hatred 
or ignorance or envy of the assailant of capital must 
be sacrificed to justice, reason, common sense and 
American fair play if national progress is not to be 

From construction and operation the mechanical 
side the road has led directly and logically to the 
financial side; to questions of investment and dividends 
and rates and profits; to all the play of vital elements 


by which, as has been shown from a merely economic 
survey of the railroad as a machine, its work and the 
public fortune must be determined. The financial 
burdens, duties and proper privileges of the railroad, 
with the reciprocal obligations of capitalist and pro- 
ducer, of shipper and carrier, will form the subject of 
the next chapter. 




ON THE financial aspects of railroad trans- 
portation, over questions of rates, dividends, 
stock issues and profits, controversy rages. 
Railroad financing, with all that the term implies, 
is perhaps, next after the subject of a national currency, 
the most important in relation to public welfare and 
national growth, the least understood and the most 
frequently and passionately discussed of all matters 
of the day. The time has come when it ought to be 
possible to draw its outlines with intelligent precision. 
First, as to capitalization. In order that it may 
obtain money with which to construct and equip its 
line, a railway company receives from the state the 
right to sell bonds and stock to those who are willing 
to purchase. It must make its offer sufficiently attrac- 
tive to bring in capital enough to push its enterprise. 
This is the difficult initial step. The total capitaliza- 
tion of the railways of the United States is in excess of 
sixteen billion dollars; making this, next after the 
land on which we live, by far the most important 
interest in the country. Its magnitude alone would 



demand for it proper consideration. Undue favour- 
itism or undue severity, applied over a field so enor- 
mous, must necessarily produce the unhappiest results. 

The railroads as a whole are not open to the charge 
of fictitious over-valuation; nor is the public carrying 
a burden for which it has not received an equivalent. 
Overwhelming proof of this appears when capitaliza- 
tion in the United States is compared with capitaliza- 
tion in other countries. 

In computing capitalization, only the stocks and bonds 
in the hands of the public should be included. On this 
basis, according to the figures of the Bureau of Rail- 
way News and Statistics, compiled under the direction 
of Mr. Slason Thompson, the capitalization of the 
railroads of the United States is $58,664 per mile. 
The comparative figures in the following table are 
from the same authority; the Federal Statistical 
Bureau makes them a little higher. 




Great Britain and Ireland . $272,291 500,000 

Germany 107,272 770,000 

France 126,350 410,000 

Belgium (state-owned) . . 169,140 

United States 58,664 1,052,119 

Thus computed, our capital charge is scarcely more 
than half that of Europe, and not much more than 
one-fifth that of the United Kingdom. 

These figures, striking as they are, do not tell the 
whole story. For capital account in other countries 


is burdened with much that it does not carry here. 
A large part of the capitalization of foreign railways 
represents money paid for such improvements as are 
paid for in this country out of current revenue. The 
betterments mentioned in the last chapter as part of 
the development of the American railroad cost immense 
sums. European managements add this to capital 
account, thus placing the burden upon posterity and 
steadily increasing the total upon which a return 
must be earned. The practice of American roads is, 
wherever possible, to meet these demands out of 
ordinary receipts; to charge off a fair amount each 
year for depreciation; to maintain the property at its 
own cost; and thus to appropriate to the future service 
of the people large amounts every year which could, 
without the slightest legal impropriety, be added to 
the dividends paid to stockholders; amounts which 
are so disposed of in most other countries of the world. 
Those who have thus put their money back into the 
property, instead of increasing its capitalization, are 
entitled to the same return upon it as to that repre- 
sented by stocks and bonds. 

Of course capitalization, both aggregate and per 
mile, will increase, just as land values do. With the 
growth of the country and of business, some betterments 
have to be made on a scale so great that it would 
bankrupt any system to pay them out of current rev- 
enue. Double tracks must take the place of single. 
A new passenger terminal may cost from $30,000,000 
up. As similar expenditures fall on all the systems, 


with the development of their territory, credit must 
be invoked, as justly and necessarily as it was for 
original construction. 

Neither this increase of capitalization nor any other, 
however, since the public is an interested party, should 
be left entirely to private determination. Near the 
close of the chapter on "Consolidation in Industry," 
the general principle is stated that the public, both 
as investor and as rate-payer, should be protected 
against misrepresentation by governmental supervision 
of the issue of new securities. No more need be said 
here than to repeat and refer the reader to that safe 
general rule, applying to railroads in common with 
all other large corporations that offer stock and bonds 
for sale and whose prices for commodities or services 
are influenced to some extent by the total of these 
that they have outstanding. Stocks should be issued 
only for legitimate purposes, disposed of at not less 
than par and paid for in cash or property at actual 

Second, as to profits and rates. The money received 
from the sale of bonds and stock having been put into 
railway construction and equipment, the company 
has a right to earn sufficient net revenue to meet its 
interest and dividend obligations. And it is to the 
public interest that this amount should be derived 
from a large volume of traffic at a low rate rather than 
from a small volume of traffic at a high rate. These 
corollaries of the creation of any railroad property 
lead at once to the heart of the matter the question 


of rates. What rate is a carrier entitled to charge for 
its services ? Who shall fix it ? What authority is 
entitled to pass upon it before it goes into effect ? 
Where nothing has been guaranteed, what rate is the 
investor entitled to receive as profit upon his capital ? 
About these queries gathers a whole library of more 
or less academic discussion. It will be impossible to 
do more, within the narrow scope of these chapters, 
than to lay down a few broad general principles that 
must eventually govern rate-making. For this is not 
a matter that passion or prejudice can determine; 
but a branch of the science of economics, under the 
rule of fixed economic law. 

The railroad company is interested in obtaining a 
rate that in addition to the cost of taxes and a proper 
allowance for maintenance and other necessary charges, 
will pay interest on its bonds and fair dividends 
on its stock. The customer is interested in obtain- 
ing a rate as low as possible; the maximum that 
he can pay being one that will enable him to 
market his products at a living profit. There is thus 
disclosed at the outset, to one who will stop a moment 
and think about it, a vital common interest between 
the two parties. A railroad can increase its profits 
only, as a rule, by increasing its receipts. Since rates 
cannot rise above a certain point without becoming 
prohibitive, their proceeds must be increased by 
increasing the volume of business. Within limits, 
the multiplier is fixed; but the multiplicand may vary 
almost without limits. The volume of business grows 


only as acre after acre of the country served is occupied 
and made to yield its greatest contribution of wealth; 
and as manufacturing and other industries arise in 
answer to the new demands so created. To bring 
this about, such rates must be made as will permit 
every industry proper to the territory in question to 
be carried on at a profit. A higher rate defeats itself 
by checking industry. A rate too low to return a 
living profit would prevent the carrier from giving 
adequate service, would ultimately destroy it and 
thus injure the people just as surely as one too high. 

It thus becomes logically evident that there must 
be a system of rates, if it can be ascertained, which 
is for the greatest good of both parties; which will 
secure to the railroad the greatest volume of business 
and the largest net return consistent with equal benefits 
to the producer and shipper; encouraging the latter 
to continue their industry and others to join them. 
The ascertainment of such a rate has been for many 
years the study of every railroad management worthy 
of the name. It has been the professed object of 
legislation. Its adjustment has been hindered more 
by passion and political demagogy on one side than 
it has by self-interest or the exercise of arbitrary power 
on the other. This ultimate desire of everybody is 
the thing known as a "just and reasonable rate." 

What, then, is a "just and reasonable rate"? It 
has to be arrived at practically and experimentally. 
The highest rate that could be charged is one that 
would absorb the whole value added to any commodity, 


over cost of production, by transporting it. The 
lowest rate imposed could not be less than the cost of 
service, plus a reasonable compensation for the use of 
the property. The reasonable rate will be found where 
the interests of the two parties are most evenly balanced. 
And it is already clear that the value which the service 
confers on the commodities and the labours of the 
shipper is a more important element in determining 
reasonableness than is the cost of the service to the 

According to common opinion, one of the first 
essentials of a reasonable rate is that it shall contain 
no discrimination between either persons or places. 
In the abstract this principle is right. Yet the numer- 
ous and important exceptions that always have been 
and always will be made to it show how empirical 
practical rate-making is; how necessary it is to experi- 
ment, to cut and fit and judge by conditions and 
results, instead of trying to enforce hard and fast rules 
regardless of consequences. 

Thus commodity rates all over the country have 
been determined less by the cost of service than by the 
public interest. Take the Northwest as an illustration. 
The most important thing to its farmers is a low rate 
on wheat. Take the case of a farmer with one hundred 
acres of wheat yielding, say, twenty bushels to the 
acre, 2,000 bushels or 60 tons. A reduction of five 
cents a hundred, or a dollar a ton, in his transporta- 
tion charge would amount to him to $60 per annum. 
If he visits the country store once a week for fifty- two 


weeks and takes away from the store each week fifty 
pounds of merchandise, in a year he will have taken 
2,600 pounds, the entire freight on which would not 
have averaged over 40 cents a hundred, or $10.40; 
so that, if the railroad carried the merchandise for 
nothing, and charged an additional five cents a hundred 
on his grain, the farmer would be worse off by nearly 
$50 a year. Consequently wheat rates have been made 
relatively lower there than in other parts of the country, 
and relatively lower than those on merchandise. This 
is literally discrimination of both kinds; yet it is not 
only unobjectionable, but highly necessary to the 
prosperity of the people and the development of the 

In the early stages, both mining and manufacturing 
interests have to be helped by low rates or frequently 
they would collapse. Grain, coal, lumber, brick these 
and like commodities are carried at rates discriminatory 
if the cost of service only is taken into account. There 
is not a railroad commission in the country that does 
not uphold this form of discrimination as just and 
reasonable. Similarly, all authorities have confirmed 
the principle that the existence of water competition 
may justify the imposition of a lower rate for the long 
haul than the short, although this form of discrimina- 
tion was first and most vehemently complained of. 
The rate made on lumber from the Pacific Coast, 
described in the chapters on "Oriental Trade," was 
discriminatory if compared with rates on other com- 
modities and judged by ordinary standards. Its 


beneficent effect in increasing traffic, developing the 
country and opening new markets under existing 
conditions was its practical justification. 

Competition, as formerly understood, may change 
the basis of the reasonable rate unfavourably. If 
there are two roads to be operated and maintained 
where one could do the business, the traffic must bear 
the burden of supporting both, and the basis of the 
reasonable rate is necessarily raised. Rate wars and 
rates below the reasonable level simply run up bills 
for the people to pay. For all charges of every sort 
are, in the end, paid by the people. There was a 
time, perhaps, when railways overcharged the people 
at non-competitive points, but that time has now 
passed. The evil is prevented both by business pru- 
dence and by the law. Therefore the reasonableness of 
rates is promoted to-day by having the transportation 
work of the country performed by the smallest number 
of carriers that can handle it effectively. The cost 
to the public of getting this work done is thus reduced 
to the minimum. 

Almost every rate has to justify itself. Rates fixed 
according to theories or abstract general principles 
are frequently impracticable and would be destructive 
of business if they were enforced. A railroad's total 
expenditure cannot be distributed over millions of 
items; and no one can say just what it costs to haul 
most commodities in general use any particular dis- 
tance. If you are in a timber country, you must 
favour the timber; if you are in a mineral country, 


you must favour the mineral; if in an agricultural coun- 
try you must favour soil products, because they are the 
foundation of all industry and all business. The 
railroad has to carry to some market the natural 
resources of the country that it serves. It must enable 
the man who lives on the farm or works in the forest 
or in the mine to carry on his work, or he will cease 
to work; and then the investment in the railroad 
becomes worthless. Since a railroad is always trying 
to increase its traffic, it must make rates such as will 
encourage the marketing of the largest volume of 
commodities. This is the fundamental law under- 
lying all rate-making; presenting to the rate-maker 
a separate problem for each system and not infre- 
quently for each commodity. 

Of course, in a rough and general way, the average 
scale of rates is based upon the aggregate cost of 
service. This has been seen to depend largely upon 
the density of traffic. If $100,000 has to be raised 
and there are 100,000 tons of freight to be carried, 
it is obvious that there must be a profit of one dollar 
per ton; but if the total of freight carried can be raised 
to 200,000 tons, a profit of fifty cents will give the 
same revenue; while an increase to 500,000 tons would 
permit the profit per ton to be cut to twenty cents. 
There is an equally variable factor on the other 
side. The courts all agree that a reasonable rate 
must be such as will pay expenses and a fair return on 
the value of the property. But the latter is not 
easy to ascertain. In many cases it is greatly in 


excess of capitalization, owing to investment not repre- 
sented and to increase in land and terminal values. 
One complication succeeds another when an effort is 
made to arrive abstractly at some general formula from 
which the "just and reasonable rate" may be derived. 
On the whole, the railroad managers of this country 
have done well in their effort to discover it practically 
by the exercise of the initiative in rate-making still 
permitted them. This will appear clearly enough 
when railway rates in the United States are compared 
with those of other countries. 

The two impressive facts about freight rates in the 
United States are that they have declined steadily 
and rapidly, and that they are now the lowest in the 
world. In 1890, by the Government statistics, the 
revenue per ton mile was .927 of a cent for the whole 
country. In 1907 it had fallen to .759. During the 
very time when the prices of all kinds of commodities 
were rising from 10 to 60 per cent., and while the 
wages of labour were greatly increased, the amount 
charged by the railroads of the country for the impor- 
tant service they render suffered this great decline. 
It does not look large when expressed in mills, but 
apply it to the tonnage of the country and see what it 
would amount to. Take by way of illustration the 
figures for the Great Northern system alone for the 
last eighteen years. The freight revenue collected in 
1909 was, in round numbers, thirty-nine million dollars; 
while the revenue from the same business, if it had 
paid the rate charged in 1881, would have been one 


hundred and thirty-nine millions. The saving from 
rate reduction for 1909 is, therefore, approximately 
one hundred million dollars. But if the whole period 
between 1881 and 1909 is taken, and the rates in 
force in 1881 are applied to it, then the difference 
between the amount so obtained and the income actu- 
ally received is found to exceed one billion dollars. 
This is the saving to shippers by reduced rates on a 
single system in the last eighteen years. 

The amount saved for the people of the whole country 
in the same time, calculated upon its gross business, 
seems almost incredible. For the year 1906, accord- 
ing to the Bureau of Railway News and Statistics, 
the people of Great Britain and Ireland paid approxi- 
mately 2.34 cents for each ton of goods carried one 
mile. If that rate were applied to the freight carried 
by all American railways in 1907, their bill would 
have been $5,536,472,527. American shippers saved 
$3,712,820,618, or more than the total value of the 
foreign commerce of the United States, in a single 
year by the low cost of transportation in this country 
as compared with Great Britain. Of all the economic 
advantages realized by the people in the last fifty years, 
nothing can compare in importance and in cash value 
with the progressive reductions in the cost of trans- 
portation by the railways. 

Very striking is a comparison between the rates 
charged by the railroads of this and those of other 
countries for a similar service. The average passenger 
rate in the United States has been brought down to a 


trifle over two cents a mile, and many attempts have 
been made to fix it at the latter figure in different states 
by law, although the courts have generally found two 
cents unreasonable. This is a little higher than the aver- 
age charge in some European countries, for the reasons 
that, where population is dense, a lower rate is possible; 
and that the bulk of the travel goes third class, sub- 
mitting for cheapness to a discrimination that would 
not be tolerated here. But the important element in 
transportation is the freight rate. The average charge 
in the United States in 1907 is given by the Interstate 
Commerce Commission as .759 of a cent. The average 
receipts per ton per mile in all the countries of Europe, 
together with India, Canada, the Argentine, Japan 
and New South Wales, is 1.36 cents. In Great Britain 
it is 2.31 cents, in Germany 1.41, in France 1.46 and 
in Austria 1.49. Both absolutely and relatively the 
low rates on American railways are one of the most 
wonderful achievements of American enterprise. The 
opinion of unprejudiced experts is that these rates as 
a whole are now too low. 

A comparison between the wages of railway employ- 
ees in the United States and in other countries discovers 
contrasts as striking as have been shown to exist in 
capitalization and in rates. According to the latest 
report of the Bureau of Railway News and Statistics, 
the average annual wage of each employee of all the 
railroads of the German Empire was $352. The 
average wage for the same year in Great Britain and 
Ireland was $261. In the United States it was $641. 


The American railway pays the highest wages in the 
world, out of the lowest rates in the world, after having 
set down to capital account the lowest capitalization 
per mile of all the great countries o? the world. No 
other occupation and no other employer of labour in 
the country can match this record. 

The persons directly employed by the railways of the 
country number between a million and a half and two 
millions. The total compensation paid to the railway 
employees in the United States is over one billion dollars 
annually. The wages of this form of labour are continu- 
ally increasing. The payroll is the main expense item 
of all railroads. In 1908 labour absorbed 43.38 per 
cent, of the gross earnings of the railways of this 
country, as against 4 1.42 per cent, in 1907 and 40.02 in 
1906. When business falls off, wages can never be re- 
duced correspondingly; and when business improves, 
the cost of labour always keeps a little in advance. 

These men all live comfortably, which is as it should 
be. The wage rate enables them to spend liberally 
for their families. Their consumption is an important 
factor in creating employment for other industries and 
raising the general level of prosperity. But continually 
increased pay and decreased working hours for the 
employee mean increased cost to the employer. The 
people must expect to make good the deficit through 
an increase in rates. A railway can pay out only what 
it takes in. It takes in nothing except what the public 
pays to it for service. The logical conclusion, that 
every concession to employees must in time be reflected 


in a rise in rates and paid for by the people, is one 
which they too often shirk. 

The other side of the rate question considers what 
rate of profit should be received by the investor in 
railway property. For no freight rate will be "just" 
or "reasonable" that does not bring him a fair return 
for the use of his capital and his risk. In any other 
business, the profit earned by capital is not a cause 
of reproach or public agitation. Manufacturing con- 
cerns, trading houses, banks, are allowed to make 
what they can. Frequently the profit is large enough 
to repay the entire original investment every few years. 
In addition to that, the property itself becomes more 
valuable. Any man could name several corporations 
that declare annually dividends to an amount which 
no railroad director would dare to propose, and 
which no railroad in this country is now or is ever 
likely to be in a position to pay. Even the banks, 
which are accountable to state and national regula- 
tion, and have been mentioned as models to which 
the railroads might be required to conform, pay 
as big dividends on their capital as they can, 
without being censured or having their interest rates 
lowered by law. 

The risks of railroad investment are greater than 
those of any form of trade. As Professor McPherson 
has justly said: "Many issues of stock represent the 
hazard in an enterprise and depend entirely for any 
value they may have upon the possibilities of the 
future. It follows that the only market value possessed 


by such issues arises from the opinion of would-be 
purchasers that the development of the traffic and 
consequent increase in the earnings of the corporation 
will at some future time result in the payment of divi- 
dends." If a railroad is unprofitable, the creditors 
throw it into a receivership and turn it over to new 
owners. But if it is profitable, the company that 
declares a dividend much above the market rate for 
loans backed by unimpeachable collateral, or that 
wisely accumulates a surplus as a safeguard against 
lean years to come, is ordered to reduce its rates. 
Neither the direct profit from a railroad's operation 
nor what is called in economics "the unearned incre- 
ment" passes unchallenged. It has to fight through 
the courts for the right to its own property, and the 
right even to a moderate return upon it. 

How modest that return is, few of those whose 
imaginations are stuffed with tales of the vast gains 
from railway operations have ever realized. Indi- 
viduals here and there, by superior energy, sagacity 
or good fortune, sometimes by all combined, amass 
large fortunes. But how has capital so employed 
fared as a whole ? Here again a comparison between 
the United States and other countries is enlightening. 
It has been seen that the capitalization of European 
railways runs from about twice to nearly five times 
that of the railways of the United States. Therefore 
the return on the latter ought to be proportionately 
higher. Exactly the opposite is the case. The per- 
centage of net earnings available for distribution on 


the immense capitalization of the railroad systems 
of England is 3.47; in France, 4.37; in Germany, 6.14. 
In the United States it averages but 4.12 per cent. 
The distribution of gross earnings, as shown by the 
following table, giving the division in 1907, is just as 
eloquent of the difference in conditions: 


United States ... 21 41 

England 37 27 

Germany .... 35 34 

France 46 31 

Setting aside the interest on bonds, which is an 
obligatory charge, the total dividends paid by the 
railways of the United States in 1907 amounted to a 
little less than 12 per cent, of the gross earnings. If 
American railways were as highly capitalized per mile 
as those of Great Britain, it would have taken 
$2,500,000,000, or more than their entire gross earn- 
ings in 1908, to pay 4 per cent, upon that capital. 

It is only right, and it is essential to the continuance 
of the service which the people expect from the rail- 
ways, that they be permitted to earn a proper profit. 
Just what that term may cover is no more mathemat- 
ically fixed than is the meaning of " a just and reasonable 
rate." It depends on the original cost of a system; 
on what it would cost to reproduce it; on what it may 
have been necessary to put into it from time to time 
to make it equal to demands upon it; on present value; 


on the amount and continuance of the risk to capital 
involved in such investment; and on the reward which 
it may be necessary to offer to capital now in order 
to pursuade it to furnish sufficient amounts for those 
betterments, additions and extensions that are just 
as necessary as was the first construction. It seems 
probable that, in view of the facts, the courts hereafter 
will place a more liberal construction than either the 
public or railway managements have been inclined 
to put in the past upon that uncertain term, "a fair 
rate of profit." 

The average rate of dividends on all the dividend- 
paying railway stock in the United States in 1907 was 
6.23 per cent. That was the year of greatest railway 
prosperity ever seen in this country. Yet 32.73 per 
cent, of all railway stocks, substantially one-third 
of the whole, paid nothing at all. In the meanwhile 
the amount exacted by the public in return for the 
privilege of holding property and doing business 
the total of railroad taxation rose from $47,415,433 
in 1900 to $80,000,000 in 1907, or over 70 per cent.; 
from $255 per mile of line to $367. It is not possible 
to curtail forever the income of any form of enterprise 
while increasing its burdens. A fair and reasonable 
profit is just as essential, in the long run, to the public's 
interest as a fair and reasonable freight rate. Unless 
this fact is realized practically in public opinion and 
in legislation, investment in railway enterprises will 
so diminish that the country must suffer seriously 
both in present convenience and in future growth. 


By referring again to the table showing how far the 
extension of railway facilities in the last ten years 
has fallen behind the increase in business to be done 
by the railways, an adequate impression may be 
obtained of the imminence of the dangers and the 
magnitude of the practical problems to be found on 
the financial side of the transportation question. 




THE fundamental principles of construction, 
operation, financing and ratemaking have 
been stated in the last two chapters. There 
remains to be considered the nature and amount of 
control exercised by the public in one way or another 
over the direction and detail of railroad affairs. The 
ramifications of the transportation interest are so 
extensive, the matter so directly affects every citizen 
of the country, and it has been for so many years thrust 
constantly to the front in public discussion and political 
campaigns that some consideration of the legislative 
regulation of railroads and its proper limits should have 
place in a statement of first principles. 

First, emphasis should be laid on the fact that both 
the people and the railways lose by the folly and profit 
by the wisdom of either. There is no other partnership 
so intimate and indissoluble; because it is grounded 
not in the inclination of either, but in the nature of 
human society and the necessity of economic law. 
The public and the railroad must always prosper or 
suffer together. If the railroad's profits are too high, 


its patrons are impoverished. If they are too low, 
deficient service and a general decline in business and 
prosperity will follow. The carrier can provide an 
adequate service and 'maintain it at the point of highest 
efficiency, and the public can enjoy the benefits of that 
ideal condition only when there is a fair and just balance 
held between them. How to secure this is the pith 
of what is commonly called "the railroad problem." 

The relation of the railway to the state just where 
public control shall begin and how far it shall extend - 
has filled with dissension the last thirty years. Between 
the demand of some of the earlier railway corporations, 
that they should be substantially exempt from all 
regulation, and the demand made to-day that legisla- 
tures and commissions should have the right, without 
appeal, to order successive reductions in rates and 
increases in expense until the railways become bankrupt, 
there is somewhere a reasonable middle ground of 
justice. In trying to arrive at this through the 
American method of advance by the conflict of extremes, 
the railway properties of this country have passed 
through strange vicissitudes. It has been like the 
slow rise of water behind a dam, the sudden sweeping 
away of all restraints, and then a slow rebuilding on 
the old foundations with a larger knowledge bought 
by costly experience. One fixed correspondence, how- 
ever, must be noted. The years in which the largest 
number of miles of railroad were built have been the 
years of greatest general prosperity. 

The first radical exercise of a public control of rates 


was followed by the evil years succeeding 1872. Then 
came a period of reorganization, placing the railroad 
once more on a sound basis and facing fairly the new 
conditions. In 1887 came the definite assertion and 
exercise of control by Congress, expressed in the 
Interstate Commerce Act. As originally enacted this 
proved neither unreasonable nor hurtful. It did not 
deny the right of the railway to earn a living. And 
its enforcement did not injure the credit or prevent 
the expansion of the railroads, because it proved that, in 
the main, they were dealing fairly with the public. 
The late Joseph Nimmo, Jr., has stated that, of 9,099 
complaints entertained by the Commission during the 
first eighteen years of its existence, 9,054 were settled 
directly, without reference to the courts, forty-five 
only of the remaining cases were appealed to the courts, 
and of these only eight were sustained. All of these 
cases alleged unjust discrimination and not one asserted 
an exorbitant rate. It is estimated that the total 
freight transactions to which the railroads of the 
United States were a party amounted during the same 
period to nearly three billions. With an open tribunal 
established for this particular class of grievances, the 
complaints were fewer than one in three hundred thous- 
and. In these billions of transactions, eight only were 
censured by the courts. The figures are eloquent 
of the observance of law by the railroad interest. 

But the matter did not end here. Subsequent 
legislation proposed to vest practical control and 
management of these properties in an outside body, 


politically appointed. Rapidly an era of frenzied 
legislation against the railroads drew on. Many of 
the states, incited by consciousness of their power 
and by every art of which the demagogue is master, 
proceeded to devote themselves for some years almost 
wholly to railroad-baiting. Within three years, ending 
in 1907, twenty-five states enacted car-service laws, 
twenty-three regulated train service and connections, 
twenty-two fixed maximum passenger rates, nine 
enacted maximum freight rates, thirty-six regulated 
the general corporate affairs of common carriers. In 
five years of the same period fifteen state railroad 
commissions were created or received large extensions 
of power. Thirty-three states enacted a total of 334 
laws regulating railroads within their jurisdiction, 
and nearly all these laws were passed without proper 
investigation or knowledge of their probable effect. 

These facts are some measure of the violence of the 
attack upon the railway interest; nearly every item 
of which had for its moving purpose or included as 
one of its results the decrease of railroad revenue or 
the increase of operating expense, or both. Rates 
were cut by arbitrary edict to a minimum unjustified 
by traffic conditions and incompatible with operation 
except at a loss. For it has already been seen that 
efficiency is nearing its maximum. The railroads 
cannot be crowded much further. The weight of 
rails, the capacity of cars, the power of locomotives 
all have a practical limit that cannot be exceeded in 
the pursuit of new economies to meet new impositions; 


and that limit has nearly or quite been reached. Every 
department of the railroad business was invaded by 
the doctrinaire and the demagogue, as well as the sincere 
legislator handicapped by ignorance of the practical 
side of the great interest with which he was attempting 
to deal. Hours of labour were shortened, changes in 
construction and rolling stock costing hundreds of 
millions were ordered, and the law, while forbidding 
combination, at the same time made competition 
impossible by prohibiting discrimination, insisting upon 
a minimum rate and standardizing the main conditions 
of the business. While imposing these new burdens, 
the public kept demanding special rates for special 
occasions, including innumerable conventions and simi- 
lar gatherings; and turned first, as usual, to the rail- 
roads with assurance when money contributions were 
desired for some public purpose. 

The consequences of this attitude of fierce unreason 
became acute in the fall of 1907. The confidence 
of the public in the security and prosperity of the 
railroad business yielded finally to continuous legis- 
lative attack. The Interstate Commerce Commission's 
Report for 1897, after most of the reorganizing work 
had been done, had shown that more than 70 per cent, 
of the entire outstanding stock of the railroads of the 
country paid no dividends, and 16.59 P er cent - f their 
bonds, exclusive of equipment trust obligations, paid 
no interest whatever. Yet ten years later an additional 
burden of some twenty million dollars a year was 
imposed on the railways by new regulative measures 


that did not add a dollar to their income. As a conse- 
quence of this continuous policy of drastic measures, 
the value of securities alone fell off nearly five billion 
dollars, while business credits decreased in probably 
equal volume. Had it not been for sound industrial 
conditions underneath, the country would not have 
recovered from the shock for twenty years. 

Not since 1893 had there been any such list of railroad 
wreckages as occurred in 1908. During that year 
over 8,000 miles of road passed into the hands of 
receivers; while crippled operation and injured credit 
represented greater damage than statistics can express. 
Half a million railway employees lost their employ- 
ment, directly or indirectly. A part of the decline in 
treasury receipts is the price the public pays for the 
legislative persecution of railroads that culminated 
in 1907. They were saved from total destruction only 
by the protection that the courts, under the Constitution, 
give to property against confiscation. But complete 
recovery is a slow process, and can be looked for only 
after some authoritative assurance that such assaults 
are ended. 

No public question touches directly the interests of 
so large a number of people, especially those who 
work hard for a living, as the prosperity of the railroads 
and their subordination to proper and freedom from 
improper regulation. The railroad has been an eman- 
cipator of labour. A commodity brings the highest 
price when it can move quickly to any point where 
demand may arise. This is notably true of labour. 


Its employment and wages depend upon freedom of 
movement from place to place. Therefore the rise 
of the national transportation system has meant much 
not only to the farmer whose products it brings to 
market, and to its own employees who now outnumber 
those of any other employer, but to every artisan, 
factory hand and other worker in the country. A con- 
siderable part of the United States would be literally 
uninhabitable without railroads. Climatic conditions 
would make life insupportable to any large population 
if comforts and necessaries could not be brought in 
from a distance. Some of the systems serving such 
territory have already been reduced by oppressive 
legislation to a financial condition so precarious that 
their service breaks down whenever subjected to any 
unusual strain; such, for instance, as a severe winter 
brings to the carrier. Business is injured or paralyzed; 
and the very lives of the people may be endangered 
by a policy which may in any emergency put before a 
railroad the choice between making its service insuffi- 
cient, or even partially discontinuing it, and inviting 
virtual bankruptcy. This negative fact is the comple- 
ment of the still more impressive positive fact that not 
the growth of manufactures or the general conditions 
which we call progress or the increase of humanity or 
the rise of labour unions has done so much to better the 
condition and broaden the opportunity for labour as 
has the railroad. 

This being true, it is singular that the public should 
be willing to mulct a railroad at every opportunity; 


for the same public also in the long run pays all the 
bills. Yet this disposition appears not only in a huge 
volume of legislation reducing rates, but in new forms 
and higher rates of taxation, in the readiness of juries 
to give large verdicts in damage suits, in the indifference 
of public authorities generally to the injury or destruc- 
tion of railroad property. Every dollar thus called 
for comes out of the pockets of the people. The 
railroad is practically helpless against unjust exactions. 
The people along its line may all move away if it suits 
them, but it must remain. It must do business with 
the community in which its lot is cast, and make a living. 
Even a receivership does not destroy track or equip- 
ment, which must still find occupation and get some 
equivalent for their service. The mere politician 
would not dare to attack and abuse any other interest 
as he does this, for it would remove to some locality 
where it could get fair play, and the community would 
be a heavy loser. Because the railroad cannot do this, 
fair-minded men should be not less but more inclined 
to insist that it receive everywhere, in the legislature, 
in the courts, in the forum of public opinion, the full 
measure of an equal and just consideration. Two 
things are self-evident: one, that it has not had this in 
the past; the other that, until it has been granted, there 
can be no permanent peace and prosperity in the world 
of industrial development or that of public affairs. 

A railroad must earn money or borrow it. It has 
no other resource. The stockholder gets a dividend 
which is usually a fixed and very low figure on most of 


the big systems of the country. Increase expense, 
and the public, not the railroad, is taxed. The railroads 
of the United States paid out more money for taxes 
alone in the year 1908 than the total receipts of all the 
railroads of Australia and those of the government 
railroads of New Zealand and Canada combined. In 
the last twenty years this tax bill of our railroads has 
increased over 200 per cent. If this came from 
some private hoard, if it were like an inheritance tax 
or an extra charge on luxuries consumed by a few 
individuals, it would still, when compared with the 
increase in other taxation, prove persecution. 

In 1907 the total taxes paid by the railways of the 
United States were nearly 10 per cent, of their net 
earnings from operation. For 1908 the percentage is 
about 12. This is, in effect, an income tax. The 
proposal to raise the income tax in England from 5 to 
7^ per cent, is considered so revolutionary that the 
whole country is aflame with the issue. In no other 
country, and upon no other form of industry or invest- 
ment in this, are such unreasonable imposts laid. 
When railroad property is assessed for taxing purposes, 
the public insists that it is never valued high enough; 
when the value of the property as an element in rate- 
making is in question, the same public insists that it is 
never made low enough. The inconsistency of the pre- 
vailing attitude toward the railroad is as marked as is its 
injustice. The owner of every other form of property 
may enjoy without reproach its natural increase; but 
if a railroad's property gains value, this is considered 


proper ground for legislative attack. Representing as 
railroad taxation does an extra burden placed by the 
people through the politicians on their own backs, 
its enormous increase and its methods prove to how 
slight an extent reason and intelligent self-interest have 
as yet been applied to the details of the relation between 
the railroad and the public. The assertion of their 
identity of interest is only the expression of an economic 
fact as certain and universal as the influence of gravita- 
tion. Perpetual conflict between them is not so much 
civil war as suicide. 

Although the tendency to interfere unnecessarily and 
hurtfully with the management of railroad properties 
has by no means been killed, its virulence has been 
somewhat abated by recent disastrous experiences. 
There will always be railroad regulation. But rail- 
road persecution shows symptoms of ptomaine poison- 
ing. Its excesses generated toxins which are destroying 
its power to harm; and the country may probably look 
forward presently to a period of constructive legislation, 
after the destructive period that ended its reign of 
more than a quarter of a century in 1907. 

The relation of public authority to the railroad 
hereafter should be and probably will be more super- 
visory than prescriptive. No arbiter not familiar with 
the whole situation, as only railway officials themselves 
can be, is qualified to fix the details of operation or 
to decide questions that may, notwithstanding apparent 
simplicity, involve the ruin of a corporation on the one 
hand or of a community on the other. Reasonable 


men, especially those who have had business experience, 
realize that the state may and must stand in the back- 
ground as a judicial referee and an enforcing executive. 
Its part is to correct ascertained evils, and to see that 
the regulations which it finds necessary to lay down 
are observed. Mr. Henry S. Haines, in his recent book 
on the subject, expresses the following conclusion, which 
harmonizes with economic principles and practical 
common sense: 

"Our national wealth is largely invested in property 
which, though productive, is not readily convertible. 
The world elsewhere is demanding the means to 
develope unutilized resources of nature, and that 
wealth which is not attached to the soil may flit away 
to lands where it may be more profitably employed. 
Let us, then, not legislate against the railroads, but for 
them! Let us regard the ills of which we complain 
as not inherent in the application of private capital 
to public use, but as incidental to the unrestricted 
control of concentrated capital; and let us seek the 
remedy which will restrict that control to purposes 
consistent with the public welfare, with powers so 
clearly defined as to be unmistakable in their limitations, 
and with such efficient supervision as will insure pub- 
licity in the exercise of corporate authority. Surely 
such a remedy can be found in legislation which will 
not be so drastic as to also limit the legitimate profits 
upon private capital invested in the railroad corpora- 
tions engaged in the performance of a public service." 

There should be a few laws, thoroughly enforced. 
The attempt to prescribe details for so vast and com- 


plicated an undertaking must necessarily end in 
failure. It follows that the tendency of late years has 
been more and more to substitute Federal for state 
regulation. Forty-six different authorities cannot issue 
orders separately to a single interest without endless 
confusion and contradictions. There can be but one 
final authority over the railroads. No subject can 
serve two masters, and much less forty-six. The 
greater cannot be included in the less; nor the inter- 
state traffic, which constitutes from 65 to 97 per cent, 
of the total over large areas of the country, accept 
directions from the comparatively trifling volume of 
business that originates and ends within the boundaries 
of a single state. 

Regulative authority there must be. But it must 
be consistent, comprehensive and uniform. It must 
be governed by the rule of fair play to the shipper, 
the railroad and the consumer alike. Behind ruthless 
aggression by either corporation or state stands the 
menacing figure of public ownership. This has no 
power to affright the present owners of railroads, 
since their property could not be taken without fair 
compensation. But for the people it would be the 
beginning of the end. No sane man can believe that 
our institutions or free government in this country 
would long survive the change. 

No government could or would have effected any 
such reduction of rates as has taken place in the last 
thirty years. Public control is everywhere slow, 
inefficient, expensive. There is not a department 


of our Federal government in which private initiative 
and modern business methods would not insure greater 
expedition, better results and a saving in cost of from 25 
to 50 per cent. Our own experience in other respects 
and the experience of state-owned railroads everywhere, 
when their finances are carefully examined and honestly 
stated, show that government ownership would require 
a material and probably a regularly advancing increase 
in railroad rates. 

Government operation of railroads would necessarily 
establish the uniform rule of a distance tariff; not only 
to satisfy the clamours and complaints of different 
communities, but to comply with the requirements 
of the Constitution and the rule that there shall be no 
discrimination. Nothing could throw transportation 
at its present stage of development into more inextri- 
cable confusion, destroy many important business 
centres more surely or more increase the cost of carriage 
on main commodities of commerce and main lines 
of travel than a distance tariff. 

In this connection it is significant that, since legisla- 
tive regulation became the order of the day, especially 
that by Act of Congress, none of the small towns of the 
country have shown marked growth. The large 
centres have gained, because they are necessarily the 
basing points for making rates. This gives them a 
business advantage. The smaller centres have, so 
far as their hoped-for commercial importance is con- 
cerned, been wiped out. The effect of Federal regula- 
tion here, as in the case of destroying competition by 


compelling the adoption of standard rates, has been 
the exact opposite of what was intended and expected. 
Its extension will be marked by a still further aggrand- 
izement of the few large strategic traffic centres at the 
expense of all smaller cities and towns. 

Aside from all economic questions, Federal ownership 
would mean the political appointment of an army of 
employees now in excess of sixteen hundred thousand, 
and soon to number two millions, mostly thoroughly 
organized and ready to act as a unit in whatever 
direction their own interests may dictate. Every man 
who does not wilfully blind himself to consequences 
must admit that our institutions could not stand the 
strain; and that the establishment of Federal ownership 
of railroad properties would mean the destruction 
of free government in the United States. 

Happily, signs that reason is resuming her sway are 
not wanting. While propositions are still heard in 
some quarters for railroad legislation that cannot be 
justified either by economic principle or existing fact, 
they are listened to with less approval and pressed 
with less avidity. The people have learned something 
of their own interest as inseparable from fair treatment 
of their common carriers. Soon after the railroad came, 
the wealth of the United States was estimated, in 1850, 
at about $7,000,000,000. It is now estimated at more 
than $130,000,000,000. More than any other single 
agency, the railroad is to be credited with this wonder- 
ful increase. The public is coming to understand 
that it must not be destroyed. 


The railway system of this country is not a failure, 
as has been charged by men who are without knowledge 
of the facts, and whose opinion consequently is of no 
value. On the contrary, it is, when judged by its 
results, in official records, perhaps the most conspicuous 
success achieved in the development of the United 
States. Costing only from one-half to one-fifth as 
much as the systems of other countries, it charges rates 
from one-third to one-half as great and pays over 
twice the rate of wages. Few inventions produced 
by American genius, probably no other industry 
perfected by American enterprise, can show a record 
that compares with this. The railroad men of this 
country have a right to resent the indiscriminate abuse 
too common in the past, and the railroad interest has 
a right to demand the protection of the laws and the 
support of an intelligent and righteous public opinion. 
Just as there is no better measure of the overflowing 
energy and unconquerable determination of the Amer- 
ican people than the upbuilding of this mighty system 
in the face of great obstacles, so will there be no fitter 
test of their capacity for self-government than their 
ability to hold the scales of justice fairly balanced 
between the conduct of our railway systems and the 
supervisory and regulative authority of the state. 

What goes by the name of "the railroad problem" 
will be solved at the same time and by the same method 
as the other problems of conduct and ethics inherent 
in all human social relations. The duty of the good 
citizen toward the railway is to insist that it shall be 


punished when it does wrong, and protected in posses- 
sion and enjoyment of its property and in the 
performance of its public functions when it is right. 
Vindictiveness in either direction is worthy only of 
the savage or the brigand. The people must remember 
here as everywhere else, if they do not wish to end in 
colossal failure, that the very first condition laid down 
in the preamble to the Constitution of the United 
States, after united effort, as preliminary to the forma- 
tion of any government worthy of the name, is - " to 
establish justice." 

Give the railroads a square deal and allow them to 
earn a fair return on their value. Compel them 
to do the work that they can do and are intended to 
do for a compensation reasonable when viewed from 
both sides. Make them render a fair service for a fair 
price, and permit them to earn and keep a fair income. 
If this rule could be the ideal of the American people, 
instead of a gospel of abuse and hate, it would not only 
close equitably an agitation disastrous to both parties, 
but it would result practically in the establishment at 
an early day of traffic conditions more favourable to 
the public than it has ever known. 

It is time for the whole country to sober down and 
think out the issues before it. They are serious enough 
to demand its most earnest effort. They are vital 
enough to elicit the most generous patriotism. This 
country has become the most prosperous in the world 
not by any magic of legislation, but by the cooperation 
of all its people in the development of natural resources 


more abundant than were ever before placed at the com- 
mand of any people. Constructive statesmanship must 
now re-establish and confirm disturbed relations between 
the activities engaged in the production of national 
wealth. A hearty union of all interests, a broad and 
genuine understanding and a deliberate, honest and 
tolerant attitude on the part of the people will do most 
to promote success in industry and sanity and perma- 
nence in the nation. 


A a meeting of the Minnesota Agricultural Society 
in 1906, I called attention to the waste of our 
national resources and to the choice between 
facing about and inviting national disaster. At the 
time, this warning was less seriously received at home? 
perhaps, than in European countries, where it was 
widely circulated and discussed. But the sober second 
thought of our own people soon lifted the subject to 
its proper place, and conservation is now a watchword 
not only for the nation but for the several states. The 
public is beginning to understand and sympathize 
with the broader view that sees national resources, 
industries and interests closely related to and dependent 
upon one another. How rapidly and how far the 
movement has travelled and its scope extended is 
shown by the resolution adopted by the National 
Conservation Congress as its creed, and the schedule 
of subjects drawn up by its committee. 

The resolution reads: "Resolved, That the objects 
of this congress shall be broad, to act as a clearing 
house for all allied social forces of our time, to seek 
to overcome waste in natural, human or moral forces." 
The programme of topics for debate and report included 



lands, irrigation, navigation, water powers, flood 
waters, forests, minerals and other resources. Such 
is the width of vision and interpretation of the con- 
servation interest to-day. But there is one subject 
missing; and it is the second in importance of them 
all. Next after the conservation of the land, its area, 
use and fertility, must come the conservation of national 
capital, in the shape of cash and credit. 

Experience has shown how surely prosperity follows 
the right employment and misfortune the abuse of 
this great national resource. Yet in the schedules of 
proposed conservation activity the waste of national 
power through excessive expenditure and overburden- 
ing of credit has apparently been overlooked. This 
forgotten item must be added to the list. The friends 
of conservation should take steps everywhere to give to 
this indispensable possession the same protection from 
the spoiler that they are trying to give to the soil, the 
forest, the water power and deposits of mineral wealth. 

We are living in an age of world-wide financial 
delirium. Most nations have thrown away modera- 
tion in the spending of money. A couple of centuries 
ago, when a monarch wanted money for his pleasures 
or his schemes of aggrandizement, he had to place a 
new tax on windows or chimneys or salt or some other 
object such that the people felt the pressure imme- 
diately. Both were warned in time; and before the 
process could go too far, either protest or revolution 
attempted to remedy the evil. Modern conditions are 
totally different. The immense increase of wealth all 


over the world has greatly augmented the supply of 
capital. The mobility of this capital, the ease by which 
through international exchanges it can be made to satisfy 
a need now in one country and now in another, 
strengthens the impression that it is inexhaustible. 

Take France, which is able to finance almost any- 
thing from a war to a manufacturing enterprise in 
any part of the world. Leroy-Beaulieu estimates that 
the wealth of the French people increases by about a 
billion dollars every year. This increment may be drawn 
upon by enterprise anywhere. It is not gathered in 
huge fortunes, but is distributed among millions of 
holders in small sums of a few thousand francs each. 
These are collected by the great banking concerns, 
ready for employment on good security in any quarter 
of the globe. While France is the best saver, she 
is not the richest of the nations. The average wealth 
per capita in some other countries is higher. The 
per capita wealth in the United States shows the 
following changes in the last sixty years: 

1850 ............. $ 307.69 

1860 ............. 5 J 3-93 

1870 ............. 779- 8 3 

1880 ............. 870.20 

1890 ............. 1,035.57 

1900 ............. 1,164.79 

1904 ............. 

Undoubtedly, at the present scale of prices, the per 
capita wealth of the United States to-day is well over 


$1,500. In most other nations the growth, while not 
so rapid, has been steady and substantial. The 
addition of these uncounted billions to the aggregate 
wealth of the world has stimulated the spirit of financial 
adventure and the love of squandering inherent in 
mankind. Its availability has lulled to sleep natural 
prudence and quieted the alarm of moments of sanity 
in the spendthrift's life; with what results will pres- 
ently be seen. 

If credit has, as Daniel Webster said, done more 
than all the mines of the world to develop and increase 
its industry, the potential dangers of credit are equally 
great. Expansion or contraction of cash is measured 
by millions; of credits, by billions. The increase of 
apparent resources by an easy resort to borrowing, the 
mortgaging of a patrimony not our own to obtain 
material for present extravagance, the diversion of 
wealth from productive to unproductive uses all 
these have gone further than most people realize. It 
will be worth while to examine current public waste 
of cash and credit. It is measured by current debt 
and current expenditure everywhere, as compared 
with the same items only a few years ago. 

The people of the United States inherited from its 
founders a wholesome tradition against debt, which 
is only now disappearing from the conduct of national 
affairs. This, together with the enormous resources 
at our command and the consequent ability of our 
people to pay increasing taxes without distress, has 
kept our national debt at a moderate figure. Until 


the time of the Spanish War and the Panama Canal, 
it decreased. It now tends to rise, concealed under 
the polite fiction of certificates of indebtedness to cover 
treasury deficits. If the advocates of large bond issues 
for all manner of internal improvements should carry 
their point, if that resource is not definitely restricted 
to the emergency of war, we will be in the condition 
of Europe, where the motto of every chancellory now 
seems to be: "After us the deluge." 

The following figures give the estimated total of 
the national debts of the countries of Europe at dif- 
ferent dates. Where statistics cover so wide a field 
there may be some inaccuracies of detail; but, in the 
great aggregate, these are of no practical consequence : 

1785-89 $2,070,600,000 

1814-18 7,213,800,000 

1845-48 7,967,000,000 

1874 18,027,800,000 

1905-07 29,552,800,000 

These are not statistics of expenditure, but of debt. 
After raising from their people by taxation all they 
can be made to contribute without dangerous unrest, 
the balance of money spent by these governments 
increased by twenty-seven and a half billion dollars 
in one hundred and twenty years. It increased eleven 
and one-half billions, or more than 60 per cent., in 
the last thirty years. The annual interest charge of 
Europe is now over $1,200,000,000 a year. She is 
in the position of a debtor who must constantly add 


to the principal of his obligations in order to get money 
to keep him from defaulting on the interest. 

The new budget threatens to shake the political 
foundations of England with its revolutionary pro- 
posals for raising more money, where borrowing had 
become impossible without turmoil and another drop 
in the price of consols. Germany has been issuing 
treasury bills for years to cover deficits. The debt 
of the empire and the several states combined is over 
$4,000,000,000. The other nations of Europe are mostly 
travelling the same road. Now how about ourselves ? 

Leaving out the. debts of counties, municipalities 
and school districts, the aggregate debt of all the 
states and territories, less sinking fund assets, 
was $274,745,772 in 1880; in 1890 it was $211,210,487; 
and in 1902 it was $234,908,873. The decrease for 
the first decade was 23.1 per cent.; and the increase 
for the twelve-year period to 1902 was 11.2 per cent. 
Inasmuch as there was in the former a readjustment 
of debts in many states by scaling down the principal, 
a fair comparison on equal terms would probably 
show that the actual burden of debt on the states only 
is growing slowly but with a tendency to accelerate 
its movement. 

Very different is the showing when the obligations 
of counties and other minor civil divisions are included. 
In our cities modern extravagance finds its most 
untrammeled expression. The total debt of the 
states, including all these minor civil divisions, increased 
$13,921,443, or 1.25 per cent., between 1880 and 1890. 


Between 1890 and 1902 it increased $727,778,393, or 
64 per cent. Nearly three-quarters of a billion in 
twelve years, an average increase of $60,000,000 a 
year in the amount borrowed by the people, ought to 
make any country stop and think. Most of the actual 
material development is privately financed, and carries 
its own bonded indebtedness, which the public finances 
cannot take into account. The figures down to 1910, 
outside of and in addition to the national debt, would 
probably show an increase of a billion and a quarter 
to a billion and a half dollars for the last twenty years, 
and a grand total of over two and a quarter billion 
dollars; about double what it was in 1890. 

Debt figures, however, do not begin to tell the story 
of our national extravagance. Only a small part of 
our public expenditure is represented by debt tables. 
The rest is raised by increased taxation. In part this 
consists of new imposts, new licenses and fees; and 
in part it comes from increased assessments of all 
property, that provide more revenue without showing 
an increased tax-rate. Nothing bears more directly 
or forcibly upon the subject of national waste and 
the conservation of national resources than the profli- 
gacy disclosed by our public expense ledgers. Every 
figure that follows has been taken from official records, 
or is the result of compiling their contents in summaries 
never before presented to the public. 

First, as to the nation. For the United States 
Government the official statements cover only what 
are known as "net ordinary disbursements." This 


total does not include the whole of the disbursements 
for the postal service, or any payment on the principal 
of the public debt, or those extraordinary expenses 
that cut an ever-increasing figure in national finances. 
It covers mostly routine charges, and therefore falls 
short each year of the actual appropriations made by 
Congress for that year. Taken alone, figures so far 
under the fact would be misleading. Relatively they 
are sufficient for the purpose, since they vary with 
our general policy. A comparison of the net ordinary 
expenditures by decades will show the trend of national 
spending. The amounts are as follows: 

1870 $293,657,005 

1880 264,847,637 

1890 297,736,487 

19 487>7 I 3>79* 

i98 659,196,320 

Although the great business expansion of this 
country began right after the Civil War, the expenses 
for 1890 were but four million dollars greater than 
those of twenty years before. Since 1890 these expend- 
itures have grown by $180,000,000 each nine years on 
the average, or $20,000,000 a year, until now they 
are 121.4 per cent, more than they were eighteen years 
ago. Expressed in terms of per capita outgo, these 
charges, which are only part of the cost of maintaining 
the Federal Government, rose from $4.75 in 1890 to 
$6.39 in 1900, and to $7.56 in 1908. 

Shift the focus of the glass a little closer and look at 


our states and cities. By official records the total 
expenditure of state government alone in all the states 
and territories of the Union combined was $77,105,911 
in 1890, and $185,764,202 in 1902. The increase in 
these twelve years was $108,658,291, or 141 per cent. 
The aggregate expenditures of all the states, together 
with their minor civil divisions of counties, municipal- 
ities and school districts, rose from $569,252,634 in 
1890 to $1,156,447,085 in 1902. The increase was 
$587,194,451, or 103 per cent. Expressed in per 
capita terms, this means that the cost of state govern- 
ment only was $1.24 for each person in 1890 and $2.35 
in 1902; for states and minor civil divisions combined 
it was $9.09 in 1890 and $14.64 in 1902. A few 
exercises in compound proportion will show what it 
may be twenty or thirty years hence. 

Official figures from 1880 to 1909 have been obtained 
from thirty of the states, covering all New England; 
New York, New Jersey and Pennsylvania of the mid- 
Atlantic section; all the representative commonwealths 
of the rich Middle West and Northwest; and a sprink- 
ling of the states of the South and the extreme West. 
These, including as they do two-thirds in number, 
four-fifths of the population and the great bulk of the 
wealth of the whole country, will show whether or 
not local extravagance is still spreading its wings. 
The aggregate expenditure of these states, not includ- 
ing their counties or municipalities, increased 28.6 
per cent, between 1880 and 1890; 58 per cent, between 
1890 and 1900; 90.7 per cent, between 1900 and 1909. 


Expressed in per capita terms, the cost of government 
in these thirty states was $1.78 for each individual in 
1880; $1.79 in 1890; $2.35 in 1900; and, assuming 
the same rate of growth in population as in previous 
years, according to the government estimate, $3.84 in 
1909. All these different series of statistical facts, traced 
independently, confirm and reinforce one another. 

It is always asserted, when the truth is told and a 
demand for economy is made, that the development of 
the country and its increase of wealth have been so 
great as both to require and justify this enlarged 
outlay. The answer to the charge of a billion dollar 
session of Congress is that this has become a billion 
dollar country. The apology is neither relevant nor 
true. It is not necessary that expense should increase 
in the same ratio as growth. But the growth of 
expenditure has so far outrun the growth of the country 
that the actual figures are almost incredible. The 
following little table, exhibiting the whole situation, 
might be printed at the top of every letterhead used by 
any man in public office anywhere in the United States: 


Wealth 1870 to 1890 116% 1890 to 1904 65% 

Foreign Trade ...."" " 99% " " 1908 85.4% 

Value Manufactured Prod. " " " 121% " " 1905 58% 
Net Ordinary Exp. U. S. 

Gov't " " " 1.4% " " 1908121.4% 

Expenditures 30 States . " " 1909 201.6% 

The moral of these half-dozen lines is overwhelming 
and their proof of public waste is complete. The rate 


of development of the country was far more rapid in 
the twenty years from 1870 to 1890 than it was in the 
eighteen from 1900 to 1908. Yet in the earlier era, 
when every great national asset was doubled in twenty 
years and the pressure for enlarged activities was cor- 
respondingly severe upon the state, the net ordinary 
expenditures of the United States increased but 1.4 
per cent. If it is national growth that makes govern- 
ment costly, how about this period ? Since then, 
with a commercial expansion expressed by a much 
smaller percentage, these net ordinary expenses have 
jumped over 121 per cent. The wealth and business 
of the country as a whole increased but little more 
than half as fast in the second period as in the first. 
The expenses of the Federal Government increased 88 
times as fast, and the expenses of the state govern- 
ments in the last nineteen years went up over 200 per 
cent. By such facts as these, quite as convicting as 
slaughtered forests or exhausted mines or impoverished 
soils or appropriated water powers, two things are 
settled once for all: no honest man should ever again 
adduce material development as a sufficient reason 
for the growing appropriation bills of nation or state; 
and the conservation movement should give to econ- 
omy in national, state and municipal expenditure 
a leading place on its programmes, and a share of 
effort commensurate with its importance and the 
country's need. 

The phenomenal increase of public expenditure 
has already produced a plentiful crop of public ills. 


It is one of the causes of the increase in prices now 
disturbing the people. This increase follows in a sug- 
gestive way the inflation of national and local budgets. 
The average cost of the supplies that must be bought 
for practically every household has increased about 
50 per cent, between 1896 and 1909. During the 
past year there has been a marked lifting of the price 
level. Foodstuffs cost from 10 to 70 per cent, more 
than ten years ago. Inquiries are now under way 
which, when fairly and intelligently carried out, will 
give some accurate measure of the extent and force 
of the movement of prices. The reports of the Federal 
Bureau of Labor show that, if we represent the average 
prices of the ten years 1890-1899 by 100, the price of 
food in 1908 was 120.6; of clothing, 116.9; f ^ ue ^ 
and lighting, 130.8; of metals and implements, 125.4; 
of lumber and building materials, 133.1; and of all 
commodities combined, 122.8. These are wholesale 
prices. If to them be added the profit of the retailer, 
a fairly good idea can be formed of the new conditions 
of our national life. 

The man who attempts to place entire responsibility 
for these changes upon one single act or influence 
lacks either fairness or intelligence. As in most great 
economic movements, the cause is complex. Some- 
thing is due to enormous currency inflation. The 
total per capita circulation in the United States in 
1896 was $21.41, and in 1909 it was $35.01. Although 
population had grown by many millions in these 
thirteen years, the amount of money to each individual 


had increased by $13.60, or more than 60 per cent. 
The increase in the total gold production of the world, 
which rose from $118,848,000 in 1890 to over 
$427,000,000 in 1908 has been made the basis for 
one form and another of credit issues aggregating a 
vast sum. Even a rudimentary knowledge of econ- 
omics or monetary science shows that such changes 
must produce a rise of prices. 

The tariff is another contributing cause. It is true 
that it can furnish but a partial explanation. For 
to only a limited extent can the rise in food prices be 
affected by or traced to the tariff. As to commodities 
that we export, the tariff is inoperative. It generally 
affects prices directly as we become importers. Never- 
theless the tariff must bear its share of responsibility 
for rising prices. Common sense says that, when 
the cost of the necessaries of life in a town on the 
Canadian side of the Detroit River is reported at 
nearly 25 per cent, less than on the American side, the 
tariff accounts for the difference. It says that a man 
will raise his charges to the full extent that he is guar- 
anteed against competition. He who believes that 
the sudden and violent rise of prices in 1897, following 
the enactment of the Dingley law, and the similar 
movement following the passage of the tariff act of 
1909 have no relation to those legislative achievements 
would argue that the rise of the Seine had nothing to 
do with the recent inundation of Paris. 

Combinations which are actually in restraint of 
trade, which have monopolized their field and are 


either controlled by a common secret management or 
a secret agreement to maintain exorbitant charges 
are partly responsible. If the operations of these 
had been followed with the same interest by the public 
and checked with the same vigour by state and nation 
that are displayed in agitation against the railroads 
which for years have been subject to public control, 
open to public inspection, and which, practically 
alone among the agencies affecting directly the common 
life, have given their services at lower and lower prices 
every decade, the country would not be so stupefied 
as it is to-day by a great hardship or so bewildered 
about the remedy. 

Still more of the rise of prices is due to the failure 
of agricultural production to keep up with the increase 
of population. Taking the average for five-year 
periods, it was shown in the chapter on " Farm Meth- 
ods" that the wheat crop of the country increased 41 
per cent, in the twenty-five years ended in 1908. From 
1880 the population increased 74 per cent. The 
decrease in wheat exports was 24 per cent. When 
wheat sold at sixty-five cents per bushel, it was because 
the world's product was relatively in excess of the 
world's demand. The ratio is now reversed, and 
demand, taking the world as a whole, is gaining on 
supply. And this is particularly true of the United 
States, with its rapid increase in population, its drift 
to the cities and its consequent actual falling off in 
important items of food products. Between January 
i, 1909, and January i, 1910, the number of cattle 


other than milch cows in this country decreased by 
more than 2,000,000, following a decrease of 700,000 
the year before. The number of swine decreased 
6,365,000, on top of a decrease of nearly 2,000,000 
the year before. The number of mouths to be fed 
is always increasing. These are conditions under 
which a simple exercise in division proves the necessity 
of price advances. It was definitely shown in advance 
that they must come. 

When due allowance has been made for the effect 
of these forces that make for dearer living, there still 
remains a large unexplained balance. This must be 
credited to the lavish expenditure which has now 
grown to be a national trait, which is eating up our 
accumulated wealth, and which is forcing prices higher 
and higher by consuming our resources unproductively, 
encouraging indolence and luxury, and compelling 
resort to a constantly ascending scale of wages. With 
these three powerful economic forces converging upon 
the price average, the country could no more escape 
the corresponding rise and no more cure it than a man 
could keep the mercury from rising in the tube of a 
thermometer while he was holding a burning glass 
so as to focus the blaze of the sun upon its bulb. This is 
the full meaning of the somewhat widely quoted state- 
ment made by me, that it is not so much the high cost of 
living as the cost of high living that afflicts the country. 

Waste, idleness and rising wages, all inter-related 
with one another, now as cause and now as effect, are, 
next to an over-issue of irredeemable paper, the three 


most powerful forces in the world to raise prices. 
First, waste. This is shown in the federal, state and 
municipal expense bills already exhibited. There 
has been mild objection in Washington to the demand 
of a certain investigating body for an appropriation 
of a quarter of a million dollars to pursue inquiries 
on which it had already spent $651,000 without any 
practical results. A charge of over $7,000,000 a year 
for secret service, an appanage of dictators and abhorred 
by every really free democracy, awakened a certain 
amount of criticism. In every state there have been 
created within the last thirty years dozens or scores 
of commissions, boards, officials, posts, all with salaries 
attached, all asking for more and all heaping up inci- 
dental expenses. Billions of free capital have been 
absorbed by the great wars of recent times, and by 
such disasters as visited San Francisco, Southern Italy 
and Paris. We are spending some hundreds of mil- 
lions at Panama, and the aim of legislators ambitious 
of popularity is to find new vents for the treasury. 
Capital in untold volume has been withdrawn by all 
these policies from productive employments. Now 
we cannot cheat the first four rules of arithmetic. We 
cannot spend money for one thing and also use it for 
another. The same money that has bought an auto- 
mobile is not on hand to build a steam thresher. There 
has been less capital for production; hence less pro- 
duction; hence a diminished supply; hence higher 

Second, habits of idleness thus encouraged diminish 


production. Where so much public money is flowing 
down the gutter, many a man finds it easier to scoop 
up what he wants than to work for it. The fashion 
of public extravagance is of all fashions the first and 
most easily imitated. As the supply of capital dwindles 
on the one side of the economic machine, the supply 
of labour dwindles on the other. We must expect 
to see this also reflected in higher prices. And so long 
as the world has to live by labour, there will be no 
escape from and no exception to this law. 

Third, perhaps the greatest factor of all in the price 
problem is the wage rate. Everybody knows that 
labour cost is the principal item in all forms of industry. 
The wage rate has been rising steadily in this country. 
Powerful forces are back of this movement. It has 
public sympathy. To resist it is difficult and may 
be dangerous. As the labour supply diminishes, for 
reasons just stated, wages rise still more. High wages 
and high prices work in a circle. Every rise of one 
is reflected in a rise of the other. But somebody has 
to pay these wages. They do not come out of the air. 
In the end labour suffers when the business no longer 
pays a profit and the payrolls cease entirely by the 
closing up of an industry no longer profitable. 

As cost of production is chiefly labour cost, the price 
of the finished article must go up if the price of labour 
is raised. This is just as true of the farm as of the 
factory. And the wages of farm labour have risen 
with the wages of labour in the trades. The complaint 
of every farmer who has to hire help is that farm 


labourers are both scarce and expensive. The fact 
that tea, coffee, sugar and such commodities, which 
are mainly imported, have risen little or none while 
other prices were soaring indicates that the high 
American wage rate raises prices and keeps them 
high. Since the labourer must receive for his work 
such compensation as will supply him with the nec- 
cessaries of life at whatever market price they com- 
mand, his wages must rise with every rise in the cost 
of living. 

The effect of national waste of capital is felt imme- 
diately in the added weight of taxation. One of the 
last things men learn is that every dollar paid out by 
a government must first have been paid in by the 
community. The income raised by any tax save 
those on articles of pure luxury is so much taken from 
productive industry; and, where not utilized for public 
protection, in that narrow range of activity which 
alone is either proper or profitable for the state, is 
as truly wasted as if it were spent on public games or 
childish bonfires. Logically, the progress of the tax- 
collector, the search for new objects and new methods 
of taxation and the exaltation of a tax into something 
beneficent in itself instead of a necessary evil 
have kept pace with the advance in national and 
local extravagance. 

The taxes collected annually from the railroads of the 
country have increased, as shown in a previous chapter, 
more than 200 per cent, since 1889. They increased by 
forty million dollars and by more than $100 per mile 


of track between 1900 and 1908. Franchise taxes, in- 
heritance taxes, taxes on corporations and income taxes 
are all recent additions or suggestions. They are re- 
ferred to here with neither approval nor disapproval as 
means of collecting money, but as part of the evil pro- 
geny of our dissipation of free capital. Not only these 
but a host of others must be resorted to if we carry out all 
the schemes that are hatched in the hotbed of waste. 
The experience of England with her budget, of every 
Continental country groaning under heavy taxes, must 
become our own if our policy is not reversed. The 
effect upon industry, prosperity and national character 
of a constantly mounting tax-rate, with its withdrawal 
of larger and larger sums every year from the fund 
that should be devoted to industrial enterprises and 
to the reproduction of wealth, is just as certain as the 
effect of drawing checks upon a bank to an annually 
larger and larger percentage of the deposits made. 

In this way, insidiously and without realization by 
the general public, often under the specious names of 
improvement and reform, capital is dissipated, dis- 
couraged and quietly abstracted from industry. In 
this way the volume of employment is greatly lessened, 
because there is less capital for payrolls. In this way 
high prices and high wages and high taxes may all 
work together for the impoverishment of a nation 
by exactly the same process that works impoverish- 
ment of its soil. The analogy between reckless waste 
of natural resources and of capital is so close, the 
necessity of conservation in the one direction as well 


as the other is so evident, that it is not easy to under- 
stand why the more thoughtful of our people did not 
long ago take steps to apply a corrective. 

The modern theory that you can safely tax the 
wealthy is just as obnoxious as the mediaeval theory 
that you can safely oppress or kill the poor. It is 
obnoxious not because wealth deserves special con- 
sideration, but because capital is the main-spring of 
all industry and material development; and, after 
you have devoted so much of it to the unproductive 
purposes that the state represents when it transcends 
its primary function as keeper of the peace and admin- 
istrator of justice, there will be just so much less left 
to pay out in wages and devote to the creation of other 
wealth. It is a fixed fact, exactly as it is that when 
you subtract x from y something less than y must 
remain. Of course the labourer suffers even more 
than the capitalist. The countries in which such 
forms of taxation are being carried furthest are pre- 
cisely those in which employment is scarce and precari- 
ous, and labour finds it necessary to lean more and 
more heavily each year upon the weakening arm of 
state and public chanty. In fact the whole subject 
is several thousand years old; and it is as amazing to 
find modern legislatures mulling over it as it would be 
if they debated hotly the comparative advantages of 
the rack and the thumb-screw as instruments of torture. 
The conclusion of the whole matter is well summed 
up in a recent article by Mr. J. Ellis Barker in the 
Fortnightly Review, in words as apt for the United 


States as they were for the British public to whom they 
were addressed: 

"Modern British financial policy, popular and 
democratic financial policy, the policy of taxing the 
wealthy for the benefit of the masses, is not a new one. 
It was practised by the Athenian democracy in the 
time of Cleon, and it led to the economic decay of 
Athens. It was practised in ancient Rome, and it 
led to the economic decay of Rome. It was practised 
by the Spaniards who plundered and drove out the 
wealthy Moors, who in the Middle Ages had made 
Spain a flourishing and wealthy industrial country, 
and it led to the economic decay of Spain. Through- 
out antiquity and the Middle Ages we meet with 
examples of the policy of taxing the rich out of exist- 
ence for the benefit of the poor, and ruin has invariably 
been the result of that popular and democratic policy." 

So it has been throughout history; and so it will 
be with us unless we are wise enough to avoid the 
hoary rock on which are plainly inscribed the legends 
and the warnings of the nations that made shipwreck 
there. It is to that fate and to no other that the social- 
istic experiment and all the policies that lead up to 
and feed it the policies which, directly or indirectly, 
are responsible for the major part of increased public 
expenditure must inevitably drag any country. 

The saving feature of the situation is that it is not 
complex, and that the remedy is not obscure. The 
laws of conservation are everywhere few and plain. 
As the way to resume specie payments was to resume, 


so the way to conserve capital is to quit wasting it. 
Material resources are conserved by taking steps to 
stop their destruction. Just so the wealth of the 
country, its capital, its credit, must be saved from 
the predatory poor as well as the predatory rich, 
but above all from the predatory politician. Nothing 
less is worthy of honest men or of a people living 
under a government of their own fashioning and 

The ideal of intelligent economy must be restored; 
let the rule be that every dollar unprofitably spent 
marks a crime against posterity just as much as does 
the dissipation of material resources. 

Expenditure must be reduced all along the line; 
since a comparison with twenty years ago shows that 
it might be cut in two without injury to any real interest. 

Credit everywhere should be conserved by a sharp 
scrutiny of new bond issues. The nation should 
reserve them for the crisis of war. No state need ever 
borrow again if it is wisely and honestly governed. 
The city that has fifty years of corporate life behind 
it, or has found it necessary to refund any portion of 
its bonded debt instead of paying at maturity, should 
be slow to draw upon its credit or mortgage the lives 
of its children yet unborn. 

Stop grafting, the offspring of public extravagance 
and the parent of civic decay; not only the gross form 
that robs treasuries, but the more subtle and danger- 
ous species that infects the masses of the people 


Individual and public economy; a just distinction 
between a high standard of comfort on one side and 
vulgar ostentation or criminal waste on the other; a 
check on income-wasting, debt creation and credit 
inflation these are the essentials of the new and 
better conservation. The reform is so great, so indis- 
pensable, so linked to our moral as well as our material 
progress that it would seem to appeal to the heart 
and mind of every American and win his enthusiastic 
devotion until its last battle shall have been won. 
Patriotism and self-interest strike hands here for the 
protection of our homes and happiness from those 
most dangerous of all enemies, the foes within our own 

The conservation movement must include this 
in its programme. It must stand for the defense and 
economic utilization of a resource without whose pain- 
ful accumulation through centuries our forests and our 
mines would still contribute little to comfort or progress, 
and our fields would still wait the plough; a resource 
which represents the concentrated efforts and pains 
and hopes of a mighty past every act of self-sacrifice 
of the father for his child, every reward of labour told 
into the treasury of savings for the future, the pulse 
of the strong hearts and the strain of the mighty sinews 
of all the millions who now are in their graves and 
have handed down to us their sacred trust. Encircled 
by the impregnable barrier which such a comprehensive 
policy of conservation should erect about it, the future 
of this nation would be secure indeed. 



IN THE movement of modern times, which has 
made the world commercially a small place 
and has produced a solidarity of the race such 
as never before existed, we have come to the point 
where we must to a certain extent regard the natural 
resources of this planet as a common asset, compare 
them with demands now made and likely to be made 
upon them, and study their judicious use. Com- 
merce, wherever untrammelled, is wiping out boun- 
daries and substituting the world relation of demand 
and supply for smaller systems of local economy. 
The changes of a single generation have brought the 
nations of the earth closer together than were the 
states of this Union at the close of the Civil War. If 
we fail to consider what we possess of wealth avail- 
able for the uses of mankind, and to what extent we 
are wasting a national patrimony that can never be 
restored, we might be likened to the directors of a 
company who never examine a balance sheet. 

The sum of resources is simple and fixed. From 
the sea, the mine, the forest and the soil must be gath- 
ered everything that can sustain the life of man. Upon 


the wealth that these supply must be conditioned for- 
ever, so far as we can know, not only his progress but his 
continued existence on earth. How stands the inven- 
tory of property for our own people ? The resources 
of the sea furnish less than 5 per cent, of the food 
supply, and that is all. The forests of this country, 
the product of centuries of growth, are fast disappear- 
ing. The best estimates reckon our standing mer- 
chantable timber at less than 2,000,000,000,000 feet. 
Our annual cut is about 40,000,000,000 feet. The 
lumber cut rose from 18,000,000,000 feet in 1880 to 
34,000,000,000 feet in 1905; that is, it nearly doubled 
in twenty-five years. We are now using annually 
500 feet board measure of timber per capita, as against 
an average of sixty feet for all Europe. The New 
England supply is gone. The Northwest furnishes 
small growths that would have been rejected by the 
lumberman thirty years ago. The South has reached 
its maximum production and begins to decline. On 
the Pacific Coast only is there now any considerable 
body of merchantable standing timber. We are 
consuming yearly three or four times as much timber 
as forest growth restores. Our supply of some vari- 
eties will be practically exhausted in ten or twelve 
years; in the case of others, without reforesting, the 
present century will see the end. When will we 
take up in a practical and intelligent way the restor- 
ation of our forests ? 

Turning now to one of the only two remaining 
sources of wealth, the mine, we find it differing from 


the others in an important essential. It is incapable 
of restoration or recuperation. The mineral wealth 
stored in the earth can be used only once. When iron 
and coal are taken from the mine, they cannot be 
restored; and upon iron and coal our industrial civiliza- 
tion is built. When fuel and iron become scarce and 
high-priced, civilization, so far as we can now foresee, 
will suffer as man would suffer by the gradual with- 
drawal of the air he breathes. 

The exhaustion of our coal supply is not in the 
indefinite future. The startling feature of our coal 
production is not so much the magnitude of the annual 
output as its rate of growth. For the decade ending 
in 1905 the total product was 2,832,402,746 tons, 
which is almost exactly one-half the total product 
previously mined in this country. For the year 
1906 the output was 414,000,000 tons, an increase 
of 46 per cent, on the average annual yield of the 
ten years preceding. In 1907 our production reached 
470,000,000 tons. Fifty years ago the annual per 
capita production was a little more than one-quarter 
of a ton. It is now about five tons. It is but eight 
years since we took the place of Great Britain as the 
leading coal-producing nation of the world, and 
already our product exceeds hers by over 43 per cent., 
and is 37 per cent, of the known production of the 
world. Estimates of coal deposits still remaining 
must necessarily be somewhat vague, but they are 
approximately near the mark. The best authorities 
do not rate them at much over 2,000,000,000,000 


tons. If coal production continues to increase as it 
has in the last ninety years, the available supply will 
be greatly reduced by the close of the century. Before 
that time arrives, however, the use of lower grades 
and mines of greater depth will become necessary; 
making the product inferior in quality and higher 
in price. Already Great Britain's industries have 
felt the check from a similar cause, as shown in her 
higher cost of production. Our turn will begin prob- 
ably within a generation or two from this time. Yet 
we still think nothing of consuming this priceless 
resource with the greatest possible speed. Our 
methods of mining are often wasteful; and we not only 
prohibit our industries from having recourse to the 
coal supplies of other countries, but actually pride 
ourselves upon becoming exporters of a prime neces- 
sity of life and an essential of civilization. 

The iron industry tells a similar story. The total 
of iron ore mined in the United States doubles about 
once in seven years. It was less than 12,000,000 tons 
in 1893, over 24,000,000 tons in 1899, 47,750,000 tons 
in 1906 and over 52,000,000 tons in 1907. The rising 
place of iron in the world's life is the most impressive 
phenomenon of the last century. In 1850 the pig iron 
production of the United States amounted to 563,758 
tons, or about fifty pounds per capita. Our production 
now is over 600 pounds per capita. We do not work a 
mine, build a house, weave a fabric, prepare a meal or 
cultivate an acre of ground under modern methods 
without the aid of iron. We turn out over 25,000,000 


tons of pig iron every year, and the production for the 
first half of 1907 was at the rate of 27,000,000 tons. 
This is two and one-half times the product of Great 
Britain. It is nearly half the product of the whole 
world. And the supply of this most precious of all the 
metals is so far from inexhaustible that it seems as if 
iron and coal might be united in their disappearance 
from common life. 

A few years ago a Swedish geologist prepared 
for his Government a report which stated that 
the entire supply of the iron ore in the United 
States would be exhausted within the present century. 
The United States Geological Survey declared this 
an overstatement; but here is the conclusion of its 
own report, after a careful examination of the ques- 
tion in the light of the best authorities. I quote the 
official published document: "Assuming that the 
demand for iron ore during the present century may 
range from 50,000,000 to 100,000,000 tons per year, 
the Lake Superior district would last for from twenty- 
five to fifty years more, if it supplied the entire United 
States. But counting on the known reserves else- 
where in the United States, the ore will last for a 
much longer period, though, of course, it must neces- 
sarily show a gradual but steady increase in value 
and in cost of mining, along with an equally steady 
decrease in grade/' The most favourable view of 
the situation forces the conclusion that iron and coal 
will not be available for common use on anything 
like present terms by the end of this century; 


and our industrial, social and political life must be 
readjusted to meet the strains imposed by new con- 
ditions. Yet we forbid to our consumers access to the 
stores of other countries, while we boast of our increased 
exports of that material for want of which one day 
the nation may be reduced to the last extremity. 

We now turn to the only remaining resource of man 
upon this earth, which is the soil itself. How are we 
caring for that, and what possibilities does it hold out 
to the people of future support ? We are only begin- 
ning to feel the pressure upon the land. The whole 
interior of this continent, aggregating more than 
500,000,000 acres, has been occupied by settlers 
within the last fifty years. What is there left for the 
next fifty years ? Excluding arid and irrigable areas, 
the latter limited by nature, and barely enough of 
which could be made habitable in each year to fur- 
nish a farm for each immigrant family, the case stands 
as follows: In 1906 the total unappropriated public 
lands in the United States consisted of 792,000,000 
acres. Of this area the divisions of Alaska, Arizona, 
California, Colorado, Idaho, Montana, Nevada, New 
Mexico and Wyoming contained 195,700,000 acres 
of surveyed and 509,000,000 acres of unsurveyed land. 
Little of Alaska is fitted for general agriculture, while 
practically all of the rest is semi-arid land, available 
only for grazing or irrigation. We have, subtracting 
these totals, 50,000,000 acres of surveyed and 36,500,000 
acres of unsurveyed land as our actual remaining 
stock. And 21,000,000 acres were disposed of in 


1907. How long will the remainder last ? No longer 
can we say that "Uncle Sam has land enough to give 
us all a farm." 

Equally threatening is the change in quality. There 
are two ways in which the productive power of the 
earth is lessened: first, by erosion and the sweeping 
away of the fertile surface into streams and thence 
to the sea; and, second, by exhaustion through wrong 
methods of cultivation. The former process has gone 
far. Thousands of acres in the East and South have 
been made unfit for tillage. North Carolina was, a 
century ago, one of the great agricultural states of the 
country and one of the wealthiest. To-day as you 
ride through the South you see everywhere land 
gullied by torrential rains, red and yellow clay banks 
exposed where once were fertile fields; and agriculture 
reduced because its main support has been washed 
away. Millions of acres, in places to the extent of 
one-tenth of the entire arable area, have been so 
injured that no industry and no care can restore them. 

Far more ruinous, because universal and continu- 
ing in its effects, is the process of soil exhaustion. It 
is creeping over the land from East to West. The 
abandoned farms that are now the playthings of the 
city's rich or the game preserves of patrons of sport 
bear witness to the melancholy change. New Hamp- 
shire, Vermont, Northern New York, show long lists 
of them. In Western Massachusetts, which once sup- 
ported a flourishing agriculture, farm properties are 
now for sale for half the cost of the improvements. 


The same process of deterioration is affecting the 
farm lands of Western New York, Ohio and Indiana. 
Where prices of farms should rise by increase of 
population, in many places they are failing. Official 
investigation of two counties in Central New York 
disclosed a condition of agricultural decay. In one, 
land was for sale for about the cost of improve- 
ments, and 150 vacant houses were counted in a lim- 
ited area. In the other, the population in 1905 was 
nearly 4,000 less than in 1855. 

Practically identical soil conditions exist in Mary- 
land and Virginia, where lands sell at from $10 to $30 
an acre. In a hearing before an Industrial Commis- 
sion the chief of the Bureau of Soils of the Department 
of Agriculture said: "One of the most important 
causes of deterioration, and I think I should put this 
first of all, is the method and system of agriculture that 
prevails throughout these states. Unquestionably the 
soil has been abused." The richest region of the West 
is no more exempt than New England or the South. 
The soil of the West is being reduced in agricultural 
potency by exactly the same processes which have 
driven the farmer of the East, with all his advantage 
of nearness to markets, from the field. 

Within the last forty years a great part of the richest 
land in the country has been brought under cultivation. 
We should, therefore, in the same time, have raised 
proportionately the yield of our principal crops per 
acre, because the yield of old lands, if properly treated, 
tends to increase rather than diminish. The year 1906 


was one of large crops and can scarcely be taken as a 
standard. We produced, for example, more corn that 
year than had ever been grown in the United States in 
a single year before. But the average yield per acre 
was less than it was in 1872. We are barely keeping 
the acre product stationary. The average wheat crop 
of the country now ranges from 12 J, in ordinary years, 
to 15 bushels per acre in the best seasons. 

But the fact of soil waste becomes startlingly evi- 
dent when we examine the record of some states where 
single cropping and other agricultural abuses have 
been prevalent. Take the case of wheat, the mainstay 
of single crop abuse. Many can remember when 
New York was the great wheat-producing state of 
the Union. The average yield of wheat per acre in 
New York for the last ten years was about 18 bushels. 
For the first five years of that ten-year period it was 
18.4 bushels, and for the last five 17.4 bushels. In 
the farther West, Kansas takes high rank as a wheat 
producer. Its average yield per acre for the last ten 
years was 14.16 bushels. For the first five of those 
years it was 15.14 and for the last five 13.18. Up in 
the Northwest, Minnesota wheat has made a name all 
over the world. Her average yield per acre for the 
same ten years was 12.96 bushels. For the first five 
years it was 13.12 and for the last five 12.8. We per- 
ceive here the working of a uniform law, independent 
of location, soil or climate. It is the law of a dimin- 
ishing return due to soil destruction. Apply this to 
the country at large, and it reduces agriculture to the 


condition of a bank whose depositors are steadily 
drawing out more money than they put in. 

What is true in this instance is true of our agricul- 
ture as a whole. In no other important country in the 
world, with the exception of Russia, is the industry 
that must be the foundation of every state at so low 
an ebb as in our own. According to the last census 
the average annual product per acre of the farms of the 
whole United States was worth $11.38. It is little 
more than a respectable rental in communities where 
the soil is properly cared for and made to give a reason- 
able return for cultivation. Nature has given to us 
the most valuable possession ever committed to man. 
It can never be duplicated, because there is none like 
it upon the face of the earth. And we are racking and 
impoverishing it exactly as we are felling the forests 
and rifling the mines. Our coil, once the envy of every 
other country, the attraction which draws millions of 
immigrants across the seas, gave an average yield for 
the whole United States during the ten years begin- 
ning with 1896 of 13.5 bushels of wheat per acre. 
Austria and Hungary each produced over 17 bushels 
per acre, France 19.8, Germany 27.6 and the United 
Kingdom 32.2 bushels per acre. For the same decade 
our average yield of oats was less than 30 bushels, 
while Germany produced 46 and Great Britain 42. 
For barley the figures are 25 against 33 and 34.6; 
for rye 15.4 against 24 for Germany and 26 for 
Ireland. In the United Kingdom, Belgium, The 
Netherlands and Denmark a yield of more than 30 


bushels of wheat per acre has been the average for the 
past five years. 

When the most fertile land in the world produces 
so much less than that of poorer quality elsewhere, 
and this low yield shows a tendency to steady decline, 
the situation becomes clear. We are robbing the soil, 
in an effort to get the largest cash returns from each 
acre of ground in the shortest possible time and with 
the least possible labour. This soil is not mere dead 
matter, subject to any sort of treatment with impunity. 
Chemically, it contains elements which must be present 
in certain proportions for the support of vegetation. 
Physically, it is made up of matter which supplies the 
principal plant food. This food, with its chemical 
constituents in proper admixture, is furnished by the 
decomposition of organic matter and the disintegra- 
tion of mineral matter proceeding together. What- 
ever disturbs either factor of the process, whatever 
takes out of the soil an excessive amount of one or 
more of the chemical elements upon which plant 
growth depends, ends in sterility. Any agricultural 
methods that move in this direction mean soil impov- 
erishment; present returns at the cost of future loss; 
the exhaustion of the land exactly as the human system 
is enfeebled by lack of proper nourishment. 

Our agricultural lands have been abused in two 
principal ways; first, by single cropping, and, second, 
by neglecting fertilization. It is fortunate for us that 
nature is slow to anger, and that we may arrest the 
consequence of this ruinous policy before it is too late. 


In all parts of the United States, with only occasional 
exceptions, the system of tillage has been to select the 
crop which would bring in most money at the current 
market rate, to plant that year after year, and to move 
on to virgin fields as soon as the old farm rebelled by 
lowering the quality and quantity of its return. It is 
still the practice, although diversification of industry 
and the rotation of crops have been urged for nearly 
a century and are to-day taught in every agricultural 
college in this country. 

The demonstration of the evils of single cropping 
is mathematical in its completeness. At the ex- 
periment station of the Agricultural College of the 
University of Minnesota they have maintained 44 
experimental plots of ground, adjoining one another, 
and as nearly identical in soil, cultivation and care 
as scientific handling can make them. On these 
have been tried and compared different methods 
of crop rotation and fertilization, together with systems 
of single cropping. The results of ten years' experi- 
ment are available. On a tract of good ground 
sown continuously for 10 years to wheat, the average 
yield per acre for the first five years was 20.22 bushels 
and for the next five 16.92 bushels. Where corn was 
grown continuously on one plot, while on the plot beside 
it corn was planted but once in five years in a system 
of rotation, the average yield of the latter for the two 
years it was under corn was 48.2 bushels per acre. 
The plot where corn only was grown gave 20.8 bushels 
per acre for the first five and n.i bushels for the second 


five of these years, an average of 16 bushels. The 
difference in average of these two plots was 32.2 
bushels, or twice the total yield of the ground exhausted 
by the single-crop system. The corn grown at the end 
of the ten years was hardly hip high, the ears small 
and the grains light. But the cost of cultivation 
remained the same. And the same is true of every 
other grain or growth when raised continuously on 
land unfertilized. We frequently hear it said that 
the reduction in yield is due to the wearing out of 
the soil. The fact is that soils either increase or 
maintain their productivity indefinitely under proper 

The remedies are as well ascertained as is the evil. 
Rotation of crops and the use of fertilizers act as tonics 
upon the soil. The more careful and thorough the 
tillage, the less the waste and the speedier the restora- 
tion of soil values. We might expand our resources 
and add billions of dollars to our national wealth by 
conserving soil resources, instead of exhausting them, 
as we have the forests and the contents of the mines. 

Every intelligent and progressive farmer will join 
stock raising with grain raising. Nature has provided 
the cattle to go with the land. There is as much 
money in live stock as there is in grain. Looked at in 
any way, there is money in live stock; money for dairy 
products, money for beef, money for the annual 
increase, and most money of all for the next year's 
crop when every particle of manure is saved and 
applied to the land. 


We need not consider at present really intensive 
farming, such as is done by market gardeners with high 
profit, or such culture as in France, in Holland, in Bel- 
gium and in the island of Jersey produces financial 
returns per acre that seem almost beyond belief. What 
our people have to do is to cover less ground, cultivate 
smaller farms so as to make the most of them, instead 
of getting a scant and uncertain yield from several 
hundred acres, and raise productivity by intelligent 
treatment to twice or three times its present level. 

There is more money in this system. The net 
profit from an acre of wheat on run-down soils is very 
small; consequently decreasing the acreage of wheat 
under certain conditions will not materially decrease 
profits. Here are some reliable estimates. The price 
of wheat is given from the United States Department 
of Agriculture Yearbook, average for ten years: 



20 $0.638 $12.76 $7.89 +$4.87 

16 10.21 + 2.32 

12 " 7.66 - 0.23 

10 " 6.38 - 1.51 

8 5.10 - 2.79 

From the above table it will be seen that as large a 
net profit is realized from one crop of 20 bushels per 
acre as from two crops of 16 bushels; and that a 12- 
bushel crop or less yields a net loss. It is a safe con- 
clusion that 75 acres of land, growing a crop of clover 
every fourth year, will yield a larger net profit than 


will 100 acres sown to grain continually. A small field 
of eight acres of clover in the Red River valley in 1907 
yielded 42 bushels, worth over $60 per acre from the 
sale of seed. 

Nearly 36 per cent, of our people are engaged directly 
in agriculture. But all the rest depend upon it. In 
the last analysis, commerce, manufactures, our home 
market, every form of activity runs back to the bounty 
of the earth by which every worker, skilled and unskilled, 
must be fed and by which his wages are ultimately 
paid. The farm products of the United States in 1906 
were valued at $6,794,000,000 and in 1908 at $7,778,- 
000,000. All of our vast domestic commerce, equal in 
value to the foreign trade of all the nations combined, 
is supported and paid for by the land. Of our farm 
area only one-half is improved. It does not produce 
one-half of what it could be made to yield; not by some 
complex system of intensive culture, but merely by 
ordinary care and industry intelligently applied. It is 
the capital upon which alone we can draw through all 
the future, but the amount of the draft that will be 
honoured depends upon the care and intelligence given 
to its cultivation. Nowhere in the range of national 
purposes is the reward for conservation of a national 
resource so ample. Nowhere is the penalty of neglect so 

The pressure of all the nations upon the waste places 
of the earth grows more intense as the last of them are 
occupied. We are approaching the point where all 
our wheat product will be needed for our own uses, and 


we shall cease to be an exporter of grain. There is still 
some room in Canada, but it will soon be filled. The 
relief will be but temporary. Our own people, whose 
mineral resources will by that time have greatly dimin- 
ished, must find themselves thrown back upon the soil 
for a living. If continued abuse of the land should 
mark the next 50 years as it has the last, what must 
be our outlook ? 

Even the unintelligent are now coming to understand 
that we cannot look to our foreign trade for relief from 
future embarrassment. Our total exports, about one- 
fourth in value of the products of our farms, and des- 
tined to shrink as consumption overtakes production, 
consist to the extent of more than 70 per cent, of articles 
grown on the soil or directly sustained by it, such as live 
stock, or made from soil products, such as flour. Of all 
the materials used in manufacture in this country, 42 
per cent, are furnished by the soil. We shall have less 
and less of this agricultural wealth to part with as 
population increases. And as to enlarging greatly our 
sale of manufactured products in the world's markets, 
it is mostly a dream. We cannot finally compete 
there, except in a few selected lines, without a material 
lowering of the wage scale at home and a change in 
the national standard of living which our people are 
not ready to accept without a struggle. When capital 
cannot find a profit there will be no money for the pay- 
rolls of an unprofitable business. Doubtless as we 
grow we shall buy more and sell more; but our main 
dependence half a century ahead must be upon our- 


selves. The nation can no more escape the operation 
of that law than can the man. 

Not only the economic, but the political future is 
involved. No people ever felt the want of work or the 
pinch of poverty for a long time without reaching out 
violent hands against their political institutions, believ- 
ing that they might find in a change some relief from 
their distress. Although there have been moments of 
such restlessness in our country, the trial has never 
been so severe or so prolonged as to put us to the test. 
It is interesting that one of the ablest men in England 
during the last century, a historian of high merit, a 
statesman who saw active service and a profound 
student of men and things, put on record his prophecy of 
such a future ordeal. Writing to an American cor- 
respondent 50 years ago, Lord Macaulay used these 

"As long as you have a boundless extent of fertile 
and unoccupied land your labouring population will 
be found more at ease than the labouring popula- 
tion of the Old World; but the time will come when 
wages will be as low and will fluctuate as much with 
you as they do with us. Then your institutions will 
be brought to the test. Distress everywhere makes 
the labourer mutinous and discontented and inclines 
him to listen with eagerness to agitators who tell him 
that it is a monstrous iniquity that one man should have 
a million and another cannot get a full meal. 
The day will come when the multitudes of people, none 
of whom has had more than half a breakfast or expects 
to have more than half a dinner, will choose a legisla- 


ture. Is it possible to doubt what sort of legislature 
will be chosen ? There will be, I fear, 

spoliation. The spoliation will increase the distress; 
the distress will produce fresh spoliation. 
Either civilization or liberty will perish. Either some 
Caesar or Napoleon will seize the reins of government 
with a strong hand, or your republic will be as fearfully 
plundered and laid waste by barbarians in the twentieth 
century as the Roman Empire in the fifth." 

We need not accept this gloomy picture too literally, 
but we have been already sufficiently warned to prevent 
us from dismissing the subject as unworthy of attention. 
Every nation finds its hour of peril when there is no 
longer free access to the land, or when the land will no 
longer support the people. Disturbances within are 
more to be feared than attacks from without. Our 
government is built upon the assumption of a fairly 
contented, prosperous and happy people, capable of 
ruling their passions, with power to change their institu- 
tions when such change is generally desired. It would 
not be strange if they should in their desire for change 
attempt to pull down the pillars of their national 
temple. Far may this day be from us. But since the 
unnecessary destruction of our land will bring new 
conditions of danger, its conservation, its improve- 
ment to the highest point of productivity promised by 
scientific intelligence and practical experiment, appears 
to be a first command of any political economy worthy 
of the name. 

These are for us quite literally the issues of national 


existence. The era of unlimited expansion on every 
side, of having but to reach out and seize any desired 
good, ready provided for us by the Hand that laid the 
foundations of the earth, is drawing to a close. The first 
task is to force the facts of the situation deep into the 
public consciousness; to make men realize their duty 
toward coming generations exactly as the father feels it 
a duty to see that his children do not suffer want. In 
a democracy this is a first essential. In other forms of 
government one or two great men may have power to 
correct mistakes and to put in motion wise policies that 
centuries do not unsettle. A part of the price of self- 
government is the acceptance of that high office and 
imperative duty as a whole by the people themselves. 
They must know, they must weigh, they must act. 
Only as they form and give effect to wise decisions can 
the nation go forward. The principle of the conservation 
of national resources as the foremost and controlling 
policy of the United States henceforth is coming to be 
seen by many, and must be heartily accepted by all, 
as the first condition, not only of continued material 
prosperity, but also of the perpetuation of free institu- 
tions and a government by the people. The work now 
being done by the Department of Agriculture and the 
agricultural colleges of the various states furnishes a 
broad and intelligent foundation upon which to build 
up a new era of national progress and prosperity. It 
calls for a wise, generous and continuing policy on the 
part of both federal and state governments. 

If this patriotic gospel is to make headway, it must 


be by organized missionary work among the people, 
and by the people. It cannot go on and conquer if 
imposed from without. It must come to represent 
the fixed idea of the people's mind, their deter- 
mination and their hope. It cannot be incorporated 
in our practical life by the dictum of any individual 
or any officer of nation or state in his official capacity. 
It needs the cooperation of all the influences, the help 
of every voice, the commendation of nation and state 
that has been the strength and inspiration of every 
worthy work on American soil for one hundred and 
twenty years. Reviving thus the spirit of the days 
that created our Constitution, the days that carried 
us through civil conflict, the spirit by which all our 
enduring work in the world has been wrought, taking 
thought as Washington and Lincoln took thought, 
only for the highest good of all the people, we may give 
new meaning to our future; new lustre to the ideal 
of a republic of living federated states; shape anew the 
fortunes of this country, and enlarge the borders of hope 
for all mankind. 






ACREAGE: Cultivated, 37; 

uncultivated, 37; wheat, 73, 


I, II, III, XVI, also Farming) 
area, 7, 198; American, 19, 
20, 76; and drainage (See 
Drainage), 194; and irriga- 
tion (See Irrigation); and 
natural wealth, 54, 154; De- 
partment of, 33, 77, 316, 322, 
327; essentials of, 31, 81; 
experiments in, 32, 35, 320; 
exports (See Exports); im- 
portance of, 15, 23, 40, 42, 
45, 46, 47, 63, 84; improve- 
ment, 41, 59, 73, 80; in Bel- 
gium, 30, 31; in Denmark, 
82, 83; in 1850 and in 1900, 
143; in France, 29, 30; in 
Germany, 27, 28, 76; in 
Great Britain, 26, 27, 75; in 
Japan, 28, 51; in Jersey, 
island of, 30; in Netherlands, 
83; in Northwest, 143, 144; 
in United States, 16, 23, 24, 
36, 315, 316, 317, 318, 319, 
320, 321, 322, 323; intensive 
(See Farming); labour (See 
also Labour), 40, 55, 167; 
modern methods, 80, 81, 154; 
possibilities of, 30, 31, 32, 33, 
34, 35, 36, 37, 72, 82, 198, 


LEGES: 60, 61, 73, 320 

TION: 58, 59, 61, 62 

TION: (See Population) 

WEALTH: Increase, 20, 
25, 36, 82, 201, 205, 221, 239, 
282, 322; in France, 29; in 
United States, 20, 25, 43, 322 


ALASKA: 204, 314 




ISTICS: (See Traits) 




Sherman Law) 

ANTWERP: 168, 214 

228, 229, 293, 295, 332 

compared with Europe, 52; 
cultivated, 25, 37; unculti- 
vated, 25, 37 




ARID LANDS: (See Irrigation) 
ASIA: (See also Orient) 89, 

158, 166, 169, 170, 180, 182 

145, 277, 292 
ATHENS: 306 
ATLAS: 64 

AUSTRALIA: 165, 277 


TRIES: (See Industry) 

BANKS: 123, 125, 264 

BARGES: 211 


BARLEY: 205, 220, 318 

BELGIUM: Agriculture, 30, 
31, 34, 36, 37; competition, 
171; railroad capitalization, 
251; trade with Argentina, 
106; wages, 167; wheat, 318, 



BOND ISSUES: 204, 290, 307 

Railroad Capitalization) 
BORROWING: (See also 

Credit, Debt) 289 

Exports), 221 

BUFFALO: 89, 214, 218, 219 
ROAD: 131, 132, 150, 152 

CESAR: 326 

CANADA: Area, 88, 324; 
banks, 91; canals (See also 
Canals), 88, 89; crops, 91; 
farms, 93; foreign trade, 89, 
90; free trade with, 93, 94, 
97; growth, 96; immigration, 
50, 87; irrigation, 191; manu- 
factures, 91, 93; merchant 
marine, 89; Northwest Prov- 
inces, population, 88; prices, 
298; railroads, 88, 157, 277; 
reciprocity with U. S. (See 
Chap. IV); smelters, 94; 
tariff, 90; timber, 88; trade 
with Great Britain, 90; trade 
with U. S., 89, 90, 95, 105, 
107; water-borne traffic, 89; 
wheat supply, 68 


CANAL RATES: 147, 214, 
215, 216, 230 

CANALS: (See also Water- 
ways) Canadian, 88, 89, 227; 
depth, 224, 227; Erie (See 
Erie Canal); European, 214, 
227; Georgian Bay, 227; 
Panama (See Panama Ca- 
nal) proposed, 213; rates 
(See Canal Rates); "Soo" 
(See "Soo" Canal); Suez 
(See Suez Canal); tonnage, 
215; Welland (See Welland 




156, 157 

CAPITAL: (See also Rail- 
road Capitalization) aggre- 
gations, 114; assailed, 240, 
248; conservation (See Chap. 
XV), 307; encouraged, 247, 
248; idle, 115, 116; invest- 
ment, 248; mobility, 288; 
needed, 247, 305; organized, 
122; rewards, 240, 247, 248, 
254, 264; supply, 288, 302; 
waste (See also Waste), 126, 

3 OI 304 

trials," 135, 137; limitation, 
136; manufacturing, 43; rail- 
road (See Railroad Capitali- 
zation); United States Steel 
Corporation, 121 

CAR: (See Railroads) 



CARRIER: (See Railroads) 


CASH: 287, 289 

CEDAR: 164 

CHANNEL: (See Waterways) 


CHICAGO: 171, 210, 218; 
grain receipts, 144; Harbour 
Commission Report, 214; in 
1850, 146; port 218; rates to 
New York, 215; trunk lines, 



55, 58, 59 

CHINA: (See also Orient, 
Oriental Trade) attitude, 
176, 183; awakening, 178, 
180; market, 104, 162, 165, 
167, 170, 180; people, 160, 
175, 176, 179; products, 157; 
resources, 160, 178, 179; 
trade, 166, 169; wages, 174, 
179, 180, 181 



101, 237 

CINCINNATI: 216, 217 

LIFE: 202 

merce, 101; destroyed, 326; 
history, 101, 234; how 
achieved, 57, 207; minerals 
and metals, 311; wheat bread, 

CIVIL WAR: 88, 198, 293, 
39> 328 


CLEON: 306 

CLOVER: 322, 323 

COAL: China, 179; consump- 
tion, n, 12; exhaustion, 12, 
154, 311, 312; importance, 
311; Nova Scotia, 88; Ohio, 
2ii; Ontario, 88; Pennsyl- 
vania, 11, 88, 211; produc- 
tion, 11, 311, 312; supply, 




try, see Industrial Consolida- 
tion; of Railroads, see Rail- 
road Consolidation) 



COMMERCE: (See Chap. V; 
see also Trade, Exports, Im- 
ports, United States, etc.) 
and civilization, 101, 103, 
109, 309; and equator, 106; 
definition, 101, 107; domestic 
and foreign compared, 107, 
323; history, 101; interstate 
(See Interstate Commerce); 
measure of progress, 102, 
109; place in industry, 101, 
102; restraints on, 108, 112, 




ESTS: 135, 153, 207, 238, 
239, 254, 269, 282, 285, 286 


NOMIC: 119, 120 

COMPETITION: Desirabil- 
ity, 126; evils, Il8; inde- 
structible, 120; Oriental, 
178, 179, 181, 182; prices, 
298; rail and river (See 
Chap. XI); transportation, 
127, 128, 174, 175, 238, 273; 
water, 257; world, 162, 170, 
183, 324 

NADIAN: (See Canada) 

CONGRESS: 171, 225, 228, 
229, 232, 271, 281, 295 


CONSERVATION: 207, 286, 
287; and tariff, 96, 07; capi- 
tal (See Chap. XV; also 
Capital); congress, 286; 
credit (See Credit); forests, 

96; in China, 179; land (See 
Chap. XVI, also Agricul- 
ture); laws, 306; mineral 
wealth, 96; national plan, 
202, 203; need of, 40, 304, 
323, 326, 327; new, 308; soil 
(See Soil) 

Chap. VI) advantages, 120, 
124; future, 124; wealth, 115 

STATES: 111,274,281,284, 


COOPERATION: 114, 202, 
284, 328 

CORN: 52, 205, 220, 317, 320, 


Chapter VI; see also Rail- 
roads) and trade, 108; evils, 
J 37; government control, 
136; profits (See also Prof- 
its), 123; rise, 115 

COST OF LIVING: (See also 
Prices), 57, 104, 297, 300 


(See Expenditure) 

COTTON: 168; crop, 221; 
market, 108, 160, 164, 165, 
180; percentage of world's 
crop, 52 


CREDIT: (See also Conser- 
vation, Debt) conservation, 
287, 307; dangers, 288; im- 
paired, 229, 331; municipal, 

CREDITS: 122, 298 


OUS: 31, 32, 80 



31, &i, 317, 319, 320, 321 

CROPS: (See Corn, Wheat, 

culture, Farming) 

CURRENCY: (See also 
Money, Monetary Standard), 

DAKOTA: (See North Da- 
kota, South Dakota) 

DAKOTA, SS.: 166 

DAMS: 192 


DEBT: (See also Credit, Ex- 
penditure, Waste) decrease, 
291; European, 290; France, 
29; Germany, 291; Great 
Britain, 291; increase, 291; 
interest, 231, 290; national 
289, 290, 293; railroad (See 
Railroad Capitalization); re- 
pudiation, 291; state, 291, 


Waterways, Mississippi River) 

DEMAGOGUE: in, 255, 273 

(See Supply and Demand) 

DENMARK: Area, 82; con- 
victs, 83; exports, 83; popu- 
lation, 83; wheat, 319 

TION: (See Population) 

(See Traffic) 

CULTURE: (See Agricul- 

DEPOSITS: (See Banks, Sav- 
ings Banks) 

DEPRESSION OF 1907: 240, 
241, 247, 273, 274 


DETROIT RIVER: 218, 298 





Railroad Rates) 

DITCHES: (See Drainage) 

industry, 33; industry, 43 

DIVIDENDS: (See also Rail- 
road Capitalization), 252, 253, 
254, 264, 266, 267, 273, 276 

(See Canada) 


DRAINAGE: (See Chapter 
X, also Reclamation) and 
health, 202; area, 195, 196, 
197; beginning, 187; cost, 
194, 196; Europe, 196; 
future, 196, 197; Minnesota, 
188; plan, 202; possibilities, 
194, 195, 205; progress, 194; 
value of lands, 196 


TION: 187 

DRY FARMING: (See Farm- 

DULUTH: 149, 150; grain 
receipts, 144; port, 218 




EAST, FAR: (See Orient) 


TION: (See Revolution) 

ECONOMICS: 254, 278, 300 

ECONpMY: (See Waste) 
combinations, 121 ; need of 
national, 40, 153, 204, 281, 
307, 308; rule of public, 230, 

EDUCATION: (See also Agri- 
cultural Education), 143 

EFFICIENCY: (See Chaps. 
I, II, III, XVI; See also 
Railroads) 125 

EGYPT: 54, 197, *9* 

EMPLOYEES: (See Labour) 

EMPTY CARS: 159, 163, 
171, 244 

ENGLAND: (See Great Brit- 


ERIE CANAL: 210, 215, 227 

EROSION: 18,315 


EUROPE: canals (See Water- 
ways), 227; debt, 290, 291; 
drainage, 196; trade with 
United States, 166, 169, 170; 
waterways, 212, 230 

TION: 160, 161, 165 
EVERGLADES: 194, 205 
EVOLUTION: 109, 153, 155, 

EXCHANGE: (See Money 

EXCHANGES : (See also 

Clearings), 288 
EXPANSION: 293, 296, 327 

ments, 281; Erie canal (See 
Erie Canal); European, 290; 
increased national, 293, 294, 
295, 296, 300, 306; Mis- 
sissippi River, 222; Panama 
Canal (See Panama Canal); 
per capita, 293, 294, 296; 
reduced, 307; states, 294, 
295,301; United States, 292, 
293, 295, 296, 301; water- 
ways (See Internal Improve- 
ments), 228, 229 

EXPORTS: (See also United 
States) 105, 170; agricul- 
tural, 21, 71, 72, 167, 324; 
flour, 70, 1 80; foodstuff's, 72; 
manufactured, 21, 72; Puget 
Sound, 166, 177; raw ma- 
terials, 20, 320; San Fran- 
cisco, 177; wheat, 69, 70, 71, 
72, 75,95,174,222,299 

Credit, Debt, Waste) 

FALLOWING: 82, 207 
FAR EAST: (See Orient) 
FARM: (See also Agriculture, 
Farmer, etc.) abandoned, 
78, 315; and railroad, 135, 
153, 206, 255, 256; animals, 
299; area, 17, 25, 144, 323; 
cultivated land, 30; im- 
provement, 33; large, 201, 
204; life, 51, 52, 202; 
methods (See also Chap. 
Ill), 71, 81, 201; model, 
41, 59, 60; neighbours, 85; 
prices, 78; products, increased 
value, 20, 25, 43, 83, 105, 
239, 323; revenue, 33; 
small, 33, 51, 200, 201, 202; 
value of property, 20, 25, 



144; values increase, 33, 201 ; 
values less, 17; values per 
acre, 82, 318; wages, 302, 


FARMER: Dignity, 54; edu- 
cation, 59, 61, 62; import- 
ance, 23, 53, 76, 84, 323; 
term of reproach, 23 

FARMING: (See also Chaps. 
I, II, III, XVI, Agriculture) 
advantages, 202; an exact 
science, 65; bad, 75, 76, 194, 
315, 316, 317, 318, 319, 320, 

321, 322, 323; dry, 198; im- 
proved, 33, 59, 75, 76, 81; 
intensive, 34, 35, 200, 201, 

322, 323; right methods, 79, 
81, 198, 322, 323; unpopu- 
lar, 23 

57, 63 

FERTILIZING: Material, 33, 
81; methods, 320, 321; need 
of,8i; neglect, 319; value, 33; 
water, 185, 207 

FINANCE: (See Capital, Rail- 



FLAX: 221 

FLOODS: 303 

FLORIDA: 194, 195 

FLOUR: Exports, 180; mar- 
ket, 1 60, 170, 174, 1 80 

FOOD PROBLEM: 5, 6, 66, 

75, 297 
FOODSTUFFS: Exports, 72; 

markets, 160; prices, 297 

ports, Imports, Trade, United 

FORESTRY: 203, 310 

FORESTS: 10, 310 



FRANCE: Agriculture, 29; 
financial power, 29, 62, 63; 
market gardening, 34, 322; 
railroad capitalization, 251; 
railroad rates, 262; reciproc- 
ity with United States, 89; 
trade Argentina, 106; trade 
Mexico, 105; trade United 
States, 89; wealth, 29, 63, 
288; wheat yield, 30, 82,318 


FREE TRADE: Between the 
states, 97; with Canada, 93, 
94, 97, 9 8 

FREIGHT: (See Railroads, 
Railroad Rates, Traffic) 

(See also Railroad Termi- 
nals) 219 

road Rates) 



GALVESTON: 212, 222 


GEORGIAN BAY: 88, 227 
GERMANY: Area, 27; ad- 
vance, 28, 48; barley, 318; 
competition, 171; crop acre- 
age increase, 27, 28; culti- 
vated area, 27; debt, 291; 
foreign trade, 27, 104; in- 
dustries, 27, 28; manufac- 



tures, 121 ; neighbours, 85; 
oats, 318; population, 27; 
potatoes, 35; railroad capi- 
talization, 251; railroad rates, 
213, 215; railroads, 213; 
river rates, 214, 215; trade 
Argentina, 106; trade Mexico, 
105; trade United States, 
89; wages, 167; waterways, 
213; wheat, 76, 82, 318 


TROL: (See Corporations, 
Railroad Legislation, Rail- 
road Rates) 


GRAIN: (See Barley, Corn, 

change, 27; barley, 318; 
coal and iron, 14, 311, 312, 
313; competition, 171; de- 
cline, 14, 48, 49; disputes 
with United States, 86; drain- 
age, 186, 196; industry, 14; 
manufacture, 14; neighbours, 
85; oats, 318; railroad capi- 
talization, 251; railroad rates, 
261; revenue, 277, 291; taxa- 
tion, 277, 304, 306; trade 
Argentina, 106; trade China, 
104; trade Denmark, 83, 90; 
trade Mexico, 105; trade 
Orient, 157, 162; trade 
Pacific, 161; trade United 
States, 89; wheat yield, 19, 
25, 26, 36, 75, 82, 318, 319 

GREAT LAKES: 146, 149, 
221, 226, 227; rates, 219; 
ships, 218; tonnage, 218 

WAY: 131, 187; capitaliza- 
tion, 150, 151; car capacity, 
243; completed to Pacific, 

166; consolidation, 149; 
density of traffic, 245; effi- 
ciency, 242; equipment, 242; 
facilities, 242; mileage, 149, 
242; rates, 260, 261; revenue, 
260, 261; rolling stock, 150; 
stockholders, 150; terminals, 
151; tonnage capacity, 243; 
traffic, 151 





DER: 76 

HANKOW: 178 



HAY: 205 




RATES: 214 

HIGHWAYS: (See Railroads, 
Rivers, Roads) 

HISTORY: civilization, 101, 
234; commerce, 10 1; Ferrero, 
63; railroad (See also Chap. 
VII), 234; Herodotus, 53; 
transportation, 101 

HOGS: 217, 300 

HOLLAND: (See Nether- 


HONGKONG: 104, 166, 172 





IDAHO: 142, t43 


ILLINOIS: 132; agriculture, 
143; farm products, 20; 
manufactures, 145; popula- 
tion, 142; property, 145; 
wheat yield, 77, 78 


IMMIGRATION: 5, 88, 146, 

IMPORTS: (See also United 
States) 105; foodstuffs, 72; 
Puget Sound, 72; San Fran- 
cisco, 178; wheat, 95 

INDIA: 157, 162, 180, 198 

INDIANA: 77, 78, 316 


TION: 56 


DATION: (See Chap. VI) 

27, 28, 44, 48, 52, 56, 118 

FIED: (See Diversification 
of Industry) 

325, 326, 327 

INTEREST: (See Capital) 

MENTS: (See also Water- 
ways), 189, 208, 216; plan, 
223, 225, 226 

(See Farming) 

IOWA: Agriculture, 143; man- 
ufactures, 94, 145; popula- 
tion, 142; property, 145; 
wheat yield, 77, 78 

MERCE: 136 

Cases, 271; power over rates, 
171, 172; reports, 240, 262, 

MERCE LAW: 128, 172, 
173, 271 

INVESTMENT: (See Capital, 

IRON: Exhaustion, 13, 154, 
313; importance, 311, 312; 
Manchuria, 178; market, 
160; production, 12, 312, 
313; supply, 13, 313 

IRRIGATION: (See also 
Chap. X, Reclamation); ad- 
vantages, 20 1; American 
Desert, 198; appropriations, 
204; area, 192; 197, 198,314; 
beginnings, 189; campaign, 
190; canals, 192; cost, 191, 
193, 194, 196, 204; effects, 
193, 204; Egypt, 197, 198; 
employees, 192; expenditures, 
192, 193; fund, 190, 191, 192; 
India, 198; Italy, 198; laws 
(See Reclamation); Mesopo- 
tamia, 198; methods, 190; 
place, 202; plan, 190, 204; 
possibilities, 22, 197, 198, 200, 
201; private, 192; progress, 
192, 204; projects, 192; 
receipts, 193; water supplied, 
191, 198 

ITALY: 57, 198, 301 

JAMESTOWN: 49, 87 
JAPAN: (See also Orient, Ori- 
ental Trade) agriculture, 18, 
28, 34, 35; area cultivated, 
28; attitude, 176, 182; 
awakening, 178, 179; food 
supply, 28, 34, 104, 170; 



manufactures, 178; market, 

104, 159, 1 60, 164, 165, 167, 

180; merchant marine, 89; 

population, 28; people, 176, 

179; products, 35, 157; 

ships, 178; trade, 166, 169; 

wages, 174, 178, 179; wheat, 



35, 322 


KANSAS: Agriculture, 143; 

population, 142; settlement, 

198; wheat acreage, 74; 

wheat yield, 317 


LABOUR: Agricultural per- 
centage of, 40, 55, 323; 
and consolidation, 122, 124; 
changed conditions, 120, 121, 
123; cost, 302; demand for, 
6, 7; hours, 122, 273; idle, 
116, 305; organized, 122; 
profits (See Profit Sharing); 
railroad (See also Wages), 
274, 275, 283; supply, 301; 
wages (See Wages) 

LABOURER: (See Labour) 

(See Railroad Rates) 

NAGE: 215 

LAKE RATES: 147, 224 

LAKES: (See Great Lakes, 

LAND: (See also Soil) Abuse 
(See Soil, exhaustion); con- 
servation (See Chaps. I, II, 
III, XVI), 326; decrease in 
value, 17; improvement (See 
Agriculture, Fertilizer, Re- 
clamation, Rotation of Crops, 
etc.); frauds, 203, 204; 
grants, 147, 187, 189; irri- 
gated (See Irrigation); laws, 
50, 189, 203, 204; natural 
resource, 15, 40, 42, 140; 
public (See Public Lands); 
values, 77, 193, 194, 201; 
reclaimed (See Drainage, 
Irrigation, Reclamation); sur- 
veyed and unappropriated, 8 

LAND GRANTS: (See Land) 

LA SALLE: 141 

LAWS: Anti-railroad (See Rail- 
road Legislation) commer- 
cial, 107; industrial, 118; 
land (See Land); natural, 
134, 137; of combination, 
139; physical, 106; regulative, 
119, 126; trade, 112, 137 

LAW, SHERMAN: (See Sher- 
man Law) 

LEGISLATION: And trade, 
108, in, 137; anti-railroad 
(See Railroad Legislation), 




LIVERPOOL: 70, 89, 168, 
227; port, 218 

LIVE STOCK: 81, 321 



LOG-ROLLING: 228, 233 

LOIRE: 29 

LONDON: 218 

LONG HAUL: 171, 257 



LOWELL: 182 

LYNN: 182 

LUMBER: Consumption, 310; 
markets, 132, 159; move- 
ment, 163, 164; prices, 163, 
164, 297; product, 163, 164, 
310; rate (See Railroad 
Rates); supply, 163, 164; 
trade, 158, 159; value, 163 





MANCHURIA: 68, 178, 180 


zation, 43; cotton, 180; em- 
ployees, 43; exports, 21, 167; 
future, 38, 39, 179, 183; 
growth, 145, 239, 295; im- 
proved processes, 121, 123; 
markets (See Markets); ma- 
terial, 234; Northwest, 144, 
145; place in industry, 40, 47; 
product, 43, 221, 239, 295 

Merchant Marine) 

MARKETS: Competition, 238; 
foreign, 107, no, 166, 167, 
168, 324; home, 57, 107, 
no; new, no, 165, 167; 

Oriental (See Oriental 
Trade); question of, 107; 
struggle for, 178, 179, 180; 
United States in foreign, 21, 
72, 104, 161 

(See Intensive Farming) 






MUM: (See Tariff) 

L. G.: 264 

also Subsidy) no, 174 


MEXICO: 85, 105, 134 

MICHIGAN: 73, 74, 221 



MIDDLE WEST: 239, 294; 
and Canada, 98; area, 220; 
commerce, 222; crops, 220, 
221; farm values, 17; popu- 
lation, 220 

MILEAGE: (See Railroads) 



MINERAL OIL: (See Petro- 

(See Coal, Iron, etc.) 


154, 202, 310 

MINNEAPOLIS: Flour, 165; 
grain receipts, 144; wheat 
prices, 95 



MINNESOTA: Agriculture, 
143, 196; Agricultural School, 
32, 320; Agricultural Society, 
285; drainage, 188, 194, 196; 
farm products, 20; land 
grants, 147; population, 142; 
potatoes, 35; railroads, 147, 
149; wheat acreage, 74; 
wheat yield, 26, 78, 317 
223; carrier, 210, 222, 230; 
improvement, 222, 226 

165, 195 

OTT: 195 
MODEL FARM: (See Farm, 


MONEY: 115, 126, 300; per 
capita, 297; volume, 122, 297 

181, 182 

MONOPOLY: 118, 122, 127 
MONTANA: 94; agriculture, 
82,143,199; irrigation, 193; 
population, 142; wheat acre- 
age, 74; wheat yield, 199 
MOORS: 306 
MORMONS: 187, 201 


Chaps. I, II, XVI) 207, 308, 



(See Resources) 

also Ships), 175 
NEBRASKA: 74, 142, 143 
NETHERLANDS: 103; agri- 
cultural products, 83; area, 
83; compared with United 
States, 83; market gardening, 
322; population, 83; wheat, 


NEW ENGLAND: 94; and 
Canada, 88, 92, 98; decline 
of farm values, 17; expendi- 
ture, 294; lumber, 310; rail- 
roads, 127; soil exhaustion, 
I9 3i6 

NEW JERSEY: 200, 294 
NEW ORLEANS: 211, 212, 

222, 226 

NEW YORK CITY: 89, 210, 
214, 227, 244; grain receipts, 
215; port, 218; rates from 
Chicago, 215; wheat prices, 
95, 174 

diture, 294; farmers, 168; 
farms, 315, 316; population, 
77> 78 316; wheat acreage, 
73; wheat production, 74, 77, 
78, 3 1 7 


NILE: 54, 197 









NORTH DAKOTA: 94, 168; 
agriculture, 143; population, 
142; wheat acreage, 74; 
wheat yield, 78 

RAILWAY: 131, 148, 150; 
car capacity, 243; completed, 
152; density of traffic, 245; 
efficiency, 242; equipment, 
242; facilities, 242; freight 
cars, 243; mileage, 242; 
tonnage capacity, 243 



CAN: (See Chap. VII) 141, 
221, 204; drainage (See 
Chap. X); freight rates, 150; 
future, 153; in 1850, 141; 
irrigation (See Irrigation); 
lumber, 310; manufacturing, 
144; railroads, 132, 133, 150, 
151, 152, 239, 242, 243, 245; 
wheat yield, 19, 317 



OATS: 52, 205, 220, 318 

OCEAN RATES: (See also 
Ships, Rates), in, 166, 167, 
171, 173, 225 

OHIO: 94, 141, 168, 221; 
coal, 2ii; farms, 316; water- 
ways, 213; wheat acreage, 
73; wheat yield, 74, 77 

OHIO RIVER: 144, 210, 211, 
217, 225 

OIL MINERAL: (See Petro- 

OKLAHOMA: 74, 78, 221 


ORDER: 114 

ORE: (See Iron); shipments, 218 

OREGON: 142, 143 

DUSTRY: 116 

ORIENT: (See also China, 
Japan, Oriental Trade) in- 
dustry, 38; manufactures, 
160; market, 108; people, 
38, 103, 104, 157; population, 
104; wages, 1 60 

Chaps. VIII, IX); condition, 
104, 108; routes, 156, 158 

PACIFIC COAST: 141 ; devel- 
opment, 164; lumber market, 
132; lumber rates (See Rail- 
road Rates); railroad supply, 
163, 310 

PACIFIC OCEAN: 157, 158, 
176, 183 

PANAMA CANAL: 227, 290; 
and Canadian trade, 96; and 
Oriental trade, 175; and 
South American trade, 89, 
106; cost, 80, 89, 108, 310 



PARIS: 29, 34, 298, 310 
PARRY, D. M.: 96 
PASSENGER: (See Railroads) 
PATRIOTISM: 284, 308, 327, 


88, 211; expenditure, 294; 
farm restoration, 33; protec- 
tion, 94 



PERU; 47 

PETROLEUM: 154, 239 



PIG IRON: 239 

PIONEERS: (See also North- 
west), 235 

PITTSBURG: 182, 211 



POLITICIAN: in, 278, 307 

STATES: Agricultural, 40, 
54, 55, 323; compared with 
Europe, 52; compared with 
world, 52; crowding, 27, 103; 
decrease, 78; density, 200, 
244, 262; in 1865, 116; in 
!95> 5> 42, IJ 6; increase, 4, 
15, 16, 67, 69, 74, 155, 198, 
205, 239, 299; Northwest, 
142; possibilities, 37, 200; 
possibilities per square mile, 
34, 35, 36; reclamation area, 
205; urban, 55 


PORTLAND: 165, 176 



POTATOES: Germany, 35; 
reclamation area, 205; United 
States, 35 


PRICES: and consolida- 
tion, 124; and securities, 253; 
coffee, 303; commodities, 
260; exported manufactures, 
93; gold, 180; high, 56, 71, 
118, 135, 297,304; in foreign 
market, no, 174; in home 
market, no; land, 77, 193, 
194, 201; rise of, 122, 297, 

298, 299, 300, 301; silver, 
1 80; steady, 1 18; sugar, 303; 
tea, 303; transportation (See 
also Railroad Rates), 260; 
wheat, 70, 71, 05, 96, 167, 
168, 180, 299; wholesale, 297 


116, 155, 179, 182, 327 

NEW YORK: 174 

PRODUCT: (See Production) 

PRODUCTION: (See also 
Farm, Manufactures, etc.); 
average annual farm in 
United States, 24; cheap- 
ened, 122; coal, 311; com- 
parative (See also France, 
Germany, Great Britain, 
etc.), 82, 83; corn, 52; cost, 
183, 302; farm (See Farm); 
gold, 298; iron, 12, 312, 313; 
manufacturing, 121; maxi- 
mum per acre, 33; oats, 52; 
potatoes, 35; wheat (See also 
Wheat), 66, 67, 69, 73, 75, 79, 
82, 322 

60, 61, 74, 78, 79, 154; in- 
crease, 20, 25, 43, 83, 105, 
239> 322, 323 

PROFITS: High, 118, 135, 
136; railroad (See Railroads); 
ships, 174; steadiness, 118; 
wheat growing, 80, 322; 
United States Steel Co., 121 


PROGRESS: (See also Chap. 
I), 114, 117, 120, 121, 137, 
139, '55, 207, 275, 310, 328 

145, 277, 292 




PROSPERITY: 116, 207, 269, 

270, 282, 287, 327 
PROTECTION: (See Tariff) 

RATES: 214 


186; appropriation, 7, 8, 49, 

50, 153, 198, 199, 314, 315; 

drainage, 197; proceeds, 

190; unappropriated, 314 


Railroad Legislation) 

PUGET SOUND: 158, 164, 
177; imports, 177; exports, 
166, 177; receipts, 165 

QUEBEC: 87, 89 

ZATION: (See also Chap. 
XIII), 250, 251; bonds, 250, 
251, 266, 373; computed, 
251; control of, 136, 253; 
decline of securities, 274; 
dividends (See Dividends); 
Europe, 265; Great North- 
ern, 151; in Belgium, 251; 
in France, 251; in Germany, 
251; in Great Britain, 251, 
266; in United States, 251, 
265, 266; increase, 136, 250, 
253; interest on, 254; legiti- 
mate, 150, 151, 252, 253; 
purpose, 250; risks, 264, 267; 
St. Paul and Pacific, 148, 
149; St. Paul, Minneapolis 
and Manitoba, 149, 150; 
stock, 250, 251, 253, 266, 267; 
total in United States, 240, 

257, 272 

TION: (See also Chap. VI) 
115, 125, 128, 273 

VISION: (See Railroad Leg- 

LATION: (See also Chap. 
XIV, Interstate Commerce 
Law) abatement, 278; Capi- 
tal (See Railroad Capitaliza- 
tion, Capital); car service, 
245, 246; confiscatory, 133, 
274; Connecticut, 246, 247; 
consolidation, 126; contra- 
dictions, 128, 129, 280; cost 
of, 273, 274; demand for, 

271, 273; demurrage, 247; 
destructive, 219, 240, 273, 
275, 276; federal, 271, 280, 
281; frenzied, 272; govern- 
ment ownership, 280, 281, 
282; ignorant, 237, 273; 
impotent, 127, 284; legiti- 
mate, 239, 258, 278, 279, 280, 
284; limits, 270, 279, 283; 
persecution, 278, 299; popu- 
lar, 275, 276; state, 262, 

272, 280; summary of, 272; 
supervisory, 278; uniformity, 
280; unreasonable, 246, 247, 
262, 272, 274, 278, 282 

Chap. XIII); and Oriental 
trade (See Oriental Trade); 
and water rates (See Com- 
petition, Canal Rates, etc.); 
basing points, 281; change 
of, 172, 173; Chesapeake & 
Ohio, 214; commodity, 256, 
257; control of, 128; discrim- 
ination, 128, 257, 258, 259, 



271,273,281; distance tariff, 
281; European, 212, 214; 
export, 166, 167, 171, 172, 
173; freight per mile, 240, 
262; high, 255; how fixed, 
252, 254, 258; in Austria, 
262; in Europe, 262; in 
France, 262; in Germany, 
213, 262; in Great Britain, 
261, 262; in Hesse, 214; 
increase, 254, 263, 264, 281; 
just, 255, 264; lake and rail, 
147,215,216,218; local, 173; 
low, 150, 163, 171, 173, 254, 
255, 256, 257, 258, 262, 263, 
283, 299; lumber, 159, 163, 
257; maximum and mini- 
mum, 173, 254, 258; mer- 
chandise, 257; notice of 
change, 172; New York and 
Chicago, 215; ocean (See 
Ocean Rates); passenger per 
mile, 240, 261, 262, 272; 
principles of, 254, 255, 256, 
259; Prussian, 214; pub- 
lished, 173; reasonable, 128, 
133, 254, 256, 258, 259, 260, 
264, 267, 284; reduction in 
United States, 127, 130, 150, 
210, 260, 272, 280; regula- 
tion (See also Interstate Com- 
merce Commission), 129, 172, 
173; revenue, 240; special, 
273; standard, 282; trans- 
continental, 163; United 
States, 214; unreasonable, 
128; volume of business, 
159, 253, 254; wars, 126, 
258; wheat, 150, 215, 256, 


RAILROADS : (See Chaps.VI, 
XII, XIII, XIV); (For 
separate systems see Great 
Northern, etc.) 120; abuse 
of, 283, 284; additions, 241, 
247, 248; age, 204; and 

capital, 247, 248; and drain- 
age, 187, 206, 207; and 
farmer, 135, 153, 206, 255, 
256; and irrigation, 21, 189, 
190, 206, 207; and trade, 
108, 238; and waterways 
(See Waterways) ; better- 
ments, 150, 151, 248, 252, 
266; Bureau of News and 
Statistics, 251, 261, 262; 
business enterprise, 135, 153; 
capacity, 241; capitalization 
(See Railroad Capitaliza- 
tion); car service, 245, 246, 
247; cars, freight, 240, 243, 
272; car shortage, 247; cars, 
passenger, 240; congestion, 
240,241,243,244; consolida- 
tion (See also Chap. VI), 
129, 133, 134, 237, 238; 
construction (See also Chap. 
XII), 237; control (See Rail- 
road Legislation); contro- 
versy, 250; cost (See also 
Railroad Capitalization), 
266, 283; cost of operation, 
238,247,272; cost of service, 
256, 258, 259, 263, 273; 
creators, 236, 282; damage 
suits, 276; density of traffic 
(See Traffic); depreciation, 
252; distribution of gross 
earnings, 266; dividends 
(See also Chap. XIII), 248, 
252; early, 125, 209, 236, 
237; economies, 129, 238, 
261, 272; efficiency, 127, 130, 
133, 238, 242, 243, 244, 245, 

247, 272, 275; employees, 
263, 274, 282; equipment, 
240, 241, 242, 243, 246; 
evolution (See Evolution); 
expenses, 273, 277; facilities, 
236; failure, 283; finances 
(See also Chap. XIII), 126, 

248, 249; first, 235; freight 



business, 240; freight rates 
,(See Railroad Rates); func- 
tions, 236; government con- 
trol, 134; groups, 126, 129, 
235, 237; growth (See also 
Northwest), 209, 210, 240, 
241 ; history (See also North- 
west), 234; hostility to (See 
also Railroad Legislation), 
108, 275; in 1850, 146, 147; 
in Europe, 134; in Mexico, 
134; in Northwest (See 
Chap. VII); investment, 
248; legislation (See Rail- 
road Legislation); locomo- 
tives, 240, 243, 272; long 
haul, 163; managements, 
255, 260; mergers, 127, 131; 
mileage, 147, 152, 236, 239, 
240, 242; monopoly, 127; 
multiplication of, 125, 132, 
258; northwestern (See also 
Chap. VII), 218, 256; paral- 
lel lines, 126, 129; passenger 
business, 240; passenger 
rates (See Railroad Rates); 
periods, 257, 270, 278; pion- 
eers (See also Northwest), 
235, 236; profits (See also 
Chap. XIII), 129, 151, 248, 
252, 253, 254, 255, 259, 264, 
265, 266, 267, 269, 270; 
problem, 149, 219, 240, 241, 
268, 270, 278, 283; prosperity, 
238; public benefactors, 237; 
rails, 244, 245, 272; rates 
(See Railroad Rates); re- 
ceipts, 254, 276; receiver- 
ships, 237, 265, 274, 276; 
regulation (See Railroad 
Legislation); reorganizations, 
149, 237, 271, 273; repro- 
duction, 266; revenue, 240, 
252, 253, 260, 272; rolling 
stock, 150, 240; securities 
(See also Chap. XIII), 131, 

133; service, 236, 275, 284; 
speculation (See Speculation); 
state, 134; stockholders, 132; 
success, 283; surplus, 151, 
264; taxation, 254, 267, 276, 
277, 278, 303; terminals (See 
Railroad Terminals); third- 
class travel, 262; tonnage, 
240; ton mileage, 240; 
traffic (See Traffic); trunk 
lines, 209, 241; value of 
property, 151, 259, 260, 266, 
277; value of service, 256; 
volume of business, 159, 253, 
254, 255, 259, 271, 280; 
wages of employees (See 
Labour, Wages) 
Buffalo, 219; congestion, 
245,247; cost, 219, 246, 252; 
Duluth-Superior, 219; ex- 
pansion, 219; Great North- 
ern, 151; insufficient, 219, 
246; machinery, 219; need of, 
241; pressure on, 209 
RATES: (See Canal Rates, 
Lake Rates, Lake and Rail 
Rates, Ocean Rates, Rail- 
road Rates, River Rates) 
ada (See Chap. IV, Canada); 
with France, 89 

X) act, 190, 197, 205; area, 
21,205,206; area crops, 205; 
cost of, 1 88, 191; law, 291; 
possibilities, 22, 200; pro- 
posed, 197; value of, 202, 207 
188, 323 



porations, Railroads, Inter- 
state Commerce) 

REID, RAY S.: 230 

RELIGION: 101, 143 


RESOURCES : (See also Land, 
Forests, Coal, Iron, etc.) 
additions to (See Chaps. I, 
II, III, XVI); agricultural, 
23, 154, 323; capital (See also 
Chap. XV), 308; conserva- 
tion (See Conservation); 
forests, 10, 154, 310; mineral, 
national (See also Chaps. 
I, XVI), 9, 10, 87, 284; sea, 
9, 310; soil (See also Soil), 
15, 40, 42, 140; waste of (See 
Waste); water 185, 204; 
world, 141, 309 

108, 112, 131 


REVOLUTION: Economic, 
126; industrial, 120, 138, 
325; popular, 287, 325, 326 

RHINE: 214 


RICE: 35, 157, 170 

(See Internal Improvements) 

RIVER RATES: (See also 
competition, Railroads, 
Waterways), 224, 230; Mis- 
sissippi, 211 ; Ohio, 211 

RIVERT RAFFIC: 212, 230; 
Mississippi, 211, 221, 222; 
Ohio, 211, 217, 218 

ROADS: (See also Railroads), 


ROME: 306,326 

32, 81, 207, 320, 321 

RUSSIA: 160, 178, 318 

177, 178, 180 
RYE: 220 


ST. LOUIS: 210, 211, 222, 

226, 227 
ST. PAUL: 147 

147, 148 

also Chap. VII) 149, 187 


SAN FRANCISCO: 176, 177, 



N.Y.: 7 8 
SEA: 9, 310 
SEATTLE: 165, 176 
SECURITIES: (See Capital) 
SEINE: 298 

SELF-INTEREST: 278, 308 
ENED: 207 


SETTLERS: 235, 236 

P.: 9, 18, 22, 154, 196 
SHANSI: 182 





174, 175 

SHIPPER: 173, 206, 246, 254, 
255, 261 

SHIPS: (See also Merchant 
Marine) American, in, 165, 
172; Dakota, 166; Min- 
nesota, 1 66; profits, 174; 
tramp, 172 

SHORT HAUL: (See Long 


SILK: 157 




SMALL FARMS: (See Farm, 
SMALL TOWNS: 281, 282 
SMELTERS: 94, 132 

SOIL: (See also Chaps. I, II, 
III, XVI,) conservation, 26, 
318; elements, 319; erosion, 
18, 315; exhaustion, 16, 18, 
77, 154, 201, 315, 316, 317, 
318, 319, 320, 321, 322, 323, 
324; fertility (See Fertilizer); 
food, 319; national resource, 
restoration (See Farming, 
Fertilizing, Rotation of 

"SOO" CANAL: Depth, 224, 
227, tonnage, 218 

SOUTH: 294; agriculture, 315, 
316; cotton crop, 221; 
lumber, 310; soil decline, 17, 

SOUTH AMERICA: 89, 107, 
166, 227 


SOUTH DAKpTA: Agricul- 
ture, 143; irrigation, 192; 
population, 142; wheat acre- 
age, 74 

SOUTHWEST: 132, 133 
SPAIN: 47, 63, 103, 306 
SPANIARDS: 156, 306 

112, 308, 324 


(See Monetary Standard) 
STATES: (See Debt, Ex- 
STATISTICS: (See separate 

titles in index) 

STATUTES: (See Laws) 
STEAMBOATS: 211, 224 
STEAMSHIPS: (See Ships) 
STEEL: 108, 160, 164, 182 

STERILITY: (See Soil, ex- 


Stock, Railroads) 
STOCKS: (See Securities) 






TENCE: 42 

SUBSIDY, SHIP: no, 174 

SUEZ CANAL: 157, 161, 177; 
tonnage, 218 


Great Lakes, Iron) 


TEST: 126, 137 


SWAMP LANDS: (See also 
Drainage) 186, 195 

SYRIA: 186 

TACOMA: 176 


TARIFF: 86; Canada, 90, 92, 
95, 98; conservation, 96, 97; 
maximum and minimum, 
109; prices, 298; system, 86, 
122; trade, 107, 108, no, 179 

TAXATION: income, 277, 
304; increase, 277, 292, 303, 
304; inheritance, 277, 304; 
monarchical, 287; national, 
292; railroad (See Railroads); 
wealth, 305, 306 

TEA: 157, 303 

TERMINALS: (See Railroad 

TEXAS: 165, 190 


TILLAGE: (See Cultivation) 

TIMBER: (See Forests, Lum- 



TONNAGE: Birkenhead, 218; 
Chicago, 218; Detroit River, 
218; Duluth-Superior, 218; 
lake, 218; lake and rail, 215; 
Liverpool, 218; London, 
218; New York, 218; rail- 
road (See Railroads) ;"Soo," 
218; Suez, 218 

TRADE: (See also Exports, 
Imports United States, etc.) 
and corporations, 108; and 
legislation, 108; and tariffs, 
107, 108, no; China, 103; 
decline, 169, 176, 177; for- 
eign, 20, 21, 69, 70, 71, 72, 
75, 104, 105, 109, 170, 180, 
324; free (See Free Trade); 
freedom for, no; Guinea, 
103; India, 103; interna- 
tional, 102, 103, 162, 171, 175; 
lumber (See Lumber); mod- 
ern, 109; movement, 170 
Oriental (See Oriental 
Trade); Pacific (See Pacific 
Trade); relative value of, 47; 
restraint of (See Restraint of 
Trade); routes, 158, 176; 
South American (See South 
American Trade) 

TRAFFIC: (See Commerce, 
Exports, Imports, Railroads, 
Reciprocity, Trade, etc.) 
centres, 245, 246, 281, 282; 
congestion, 219, 220, 223, 
240, 241, 245 248; density, 
244, 245, 259; expediting 
(See Railroads, efficiency); 
facilities, 219; local, 280; 
increase, 238, 247, 258; inter- 
state, 280; movements, 164, 
165; through, 125, 126, 280; 
volume and rates, 159, 206, 
238, 240; world, 158 



TRAMP SHIPS: (See Ships) 

SYSTEMS: (See also Rail- 
roads, Great Northern, North- 
ern Pacific, etc.) 149, 152, 
157, 244, 245 

also Railroads, Ships, Water- 
ways); agencies, 208, 2io; 
cheap, 234; competition (See 
also Competition), 127, 128, 
174, 175; cost of, 127, 171, 
258, 261; disturbance, 281; 
history, 101, 234; laws, 128, 
223, 258, 269; literature, 234; 
machine, 158, 165, 239, 240, 
243, 245, 248; Northwest 
(See Chap. VII); problem, 
149, 219, 233, 268; relation 
to industry, 235, 275; system 
in United States, 113, 247; 
urban, 116 

Agriculture, Farm) 

TRUNK LINES: (See Rail- 

TRUSTS: 117 

214, 216 


264, 265, 277 

UNEMPLOYED: 120, in 
England, 14, 48, 49, 182 

ture (See Agriculture); and 
Canada (See Chap. IV); 
area, 205; capital (See Capi- 
tal); coal (See Coal); com- 
mercial supremacy, 113, 183; 
cost of government, 280, 281; 

crops (See Crops); debt (See 
Debt); density of traffic, 244, 
245; drainage (See Drain- 
age); expenditure (See Ex- 
penditure); exports (See Ex- 
ports); farm areas, 144; 
farm products (See Farm); 
farm values, 82; foreign 
trade (See also Exports, 
Imports), 295; forests (See 
Forests, Lumber); imports 
(See Imports); iron (See 
Iron); irrigation (See Irriga- 
tion); land grants (See 
Land); manufactures (See 
Manufactures); neighbours, 
85; oats (See Oats); popu- 
lation, 4, 5, 16, 34, 35, 36, 37, 
40,42,52,55,67,69,74, 1 1 6, 
200; production compared 
with Netherlands, 83; rail- 
road mileage (See Railroads); 
railroad rates (See also Rail- 
road Rates), 130; railroads 
(See Railroads); railroad 
statistics, 240; trade with 
Argentina, 106; with Asia, 
89, 166, 169; with Canada, 
85, 89, 90, 95, 107; with 
China, 166, 169; with Eur- 
ope, 166, 169; with France, 
89; with Germany, 89; with 
Great Britain, 89; with 
Hongkong, 166; with Japan, 
1 66, 169; with Mexico, 105; 
with North America, 166; 
with Orient (See Oriental 
Trade); with Pacific, 160, 
161; with South America, 
89, 107, 161, 166; transporta- 
tion (See Railroads, Trans- 
portation, Waterways); value 
of farm products, 83; wages, 
167; waterways (See Water- 
ways); wealth increase (See 
Wealth); wheat acreage (See 



also Wheat), 67, 73, 74; 
wheat consumption, 69, 74, 
96; wheat crop per acre, 79, 
317, 318; wheat yield, 26, 
27, 35> 66, 67, 69, 73, 75, 82, 


World Unity) 


TION; (See Transportation) 

UTAH: 201 

VEGETABLES: (See Agricul- 
ture, Farm) 

VENICE: 103, 156 


VESSELS: (See Ships, Steam- 
boats, Tonnage) 



WAGE FUND: 302, 305, 324 
WAGES: and consolidation, 

121, 124; and tariff, 92; Bel- 
gium, 167; factories, 72; 
farm, 56, 80, 302, 303; Ger- 
many, 167; Orient, 104, 179, 
180, 182; railway employees 
Great Britain, 262; railway 
employees Germany, 262; 
railway employees United 
States, 262, 263, 283; rise, 

122, 260, 300, 301, 302, 304; 
seamen, 175; United States 
(See also Farm, Manu- 
factures, etc.), 167, 324, 325 


328; letter to Hamilton, 76 


agriculture, 143, 1 68; lumber, 
163, 164; population, 142; 
wheat acreage, 74; wheat 
prices, 174 

WASTE: (See also Debt, Ex- 
penditure) economic, 119, 
204, eliminating, 206; farm, 
80; federal, 290, 293, 295; 
financial (See also Chap. 
XV), 202; internal improve- 
ment (See Waterways); land 
(See Land); national, 300, 
301, 303, 304, 309; products 
utilized, 121; railroad, 131, 
134, 238 

WATER: Distribution of, 185, 
186; fertilizer, 185; supply 
(See also Chap. X ), 206 

Stock Watering) 

WATERWAYS: (See also 
Canals, Lakes, Rivers, Chap. 
XI), American, 215; and 
railroad (See also Chap. XI, 
Competition, etc.), 247; and 
trade, 108, 241; appropria- 
tions, 225, 228, 229, 232; 
bond issues, 229, 231, 290; 
commission, 228, 232; de- 
mands, 213, 228, 229, 231; 
depth of channel, 216, 224, 

225, 226, 227; facilities, 216, 
217; function, 209, 220, 223; 
Germany, 213; improvement 
(See Internal Improvements); 
neglect, 216; plan, 223, 225, 

226, 228, 232; relative rank, 
228, 232; report, 230; ter- 
minals, 219; traffic, 223, 224; 
value, 209, 220, 228; waste, 
225, 229, 231 



WEALTH: Agricultural (See 
Agricultural Wealth); 
France, 29; mobility, 279; 
national additions to, 20, 25, 
201, 205, 282, 295, 296, 321; 
per capita in United States, 
288; real (See also Agricul- 
ture, Farm), 47, 221: taxa- 
tion of, 305, 306; world's, 




WEST: (See also Northwest), 
17, 18, 73, 294, 316, 317 

WHEAT: Acreage, 67, 73, 74; 
consumption, 69, 299, 323; 
consumption per capita, 69, 
74, 96; cost of production, 
322; demand and supply, 
66, 67, 68, 69, 71, 74, 299; 
experiments in cultivation, 
32, 35, 320; exports, 69, 70, 
71, 75, 222, 299, 324; freight 
rates (See Rates); imports, 
95; losses, 322; milling in 
bond, 95; prices, 67, 68, 69, 

7> 7 X > 95, 9 6 > l6 7? l68 > i73 
1 74, 1 80, 299, 322 ; production, 
66, 67, 69, 73, 74, 75, 79, 82, 
322; profits, 80, 322; retained 
for consumption, 69, 70; 
surplus, 69, 75; value, 205; 
value per acre, 322; yield 
Austra, 318; yield France, 
30, 82, 318; yield Germany, 

76, 82, 318; yield Great 
Britain, 26, 36, 75, 82, 318; 
yield Hungary, 318; yield 
Illinois^77, 78; yield Indiana; 
77; yield Iowa, 77, 78; yield 
Kansas, 317; yield Michigan, 
74; yield Middle West, 220; 
yield Minnesota, 26, 317; 
yield Montana, 199; yield 
New York, 74, 77, 78, 317; 
yield Ohio, 74, 77; yield 
reclamation area, 205; yield 
United States, 26, 27, 35, 66, 
69, 75, 78, 82, 299, 317, 318, 
322; yield United States 
compared with world, 52 


WISCONSIN: 221; agricul- 
ture, 143; manufactures, 145; 
population, 142; property, 
145; waterways report, 230 

WORKINGMAN: (See also 
Labourer), 120, 121, 122 

WORLD UNITY: 99, 100, 
103, 107, 109, 309 

North Yakima) 

YANKEE: 104 


JECT: 193 

YOKOHAMA: 104, 171 




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